A Practical Guide to Knowledge Management (Thorogood Professional Insights)

THOROGOOD PROFESSIONAL INSIGHTS

A SPECIALLY COMMISSIONED REPORT

A PRACTICAL GUIDE TO KNOWLEDGE MANAGEMENT Sue Brelade and Chris Harman

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THOROGOOD PROFESSIONAL INSIGHTS

A SPECIALLY COMMISSIONED REPORT

A PRACTICAL GUIDE TO KNOWLEDGE MANAGEMENT Sue Brelade and Chris Harman

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Acknowledgements The authors would like to thank Kate Le Marechal for her assistance with this Report. They would also like to thank David Cowan, Juliet Butterworth and Sean Mcllveen for contributing case studies and Andrew Docherty, Dr Peter Roberts and Robin Williams for their helpful discussions on knowledge management. They are also indebted to a number of managers and staff in various organisations who shared their knowledge and experience freely.

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The authors Sue Brelade BA (Hons), MA, Dip.Mgt, FCIPD, AIL, works as a human resources consultant. She has gained wide-ranging experience in the practical application of training and development and HR, working in industry sectors as diverse as central and local government, contracting, media, travel, financial services and with trade bodies. She has worked within the UK and across Europe where her multilingual skills have been invaluable. Bringing a combination of practical and academic skills to the design and delivery of human resources solutions has given her a reputation for understanding and meeting business needs. She is the author of a number of published articles in professional journals, and coauthor of ‘101 Tips for Trainers’, ‘Practical Training Strategies for the Future’ and ‘Knowledge Management and the Role of HR’. Christopher Harman BA (Hons), MA, FCIPD, has considerable experience working at a senior and strategic level within organisations. Currently working as an HR Director with local government and previously as a consultant and within the television industry, he has extensive experience of professional HR and strategic management. With a keen interest and involvement in training, his work in the field of management development has gained national recognition. He has served on national committees and has been a professional adviser on HR issues for a major employers’ organisation. He is also the author of various reports and published articles and is co-author of ‘Practical Training Strategies for the Future’ and ‘Knowledge Management and the Role of HR’. Sue Brelade provides a consultancy service to business and can be contacted on [email protected]

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Contents

1

INTRODUCTION

1

KNOWLEDGE MANAGEMENT MAP

3

INTRODUCTION TO KNOWLEDGE MANAGEMENT

4

Introduction .................................................................................................5 Definitions of knowledge management ....................................................5 The language of knowledge management ...............................................8 Drivers for knowledge management ......................................................12 Knowledge management activities .........................................................15

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KNOWLEDGE MANAGEMENT – THE SYSTEMS DIMENSION

16

Introduction ...............................................................................................17 Technical perspectives on knowledge management .............................18 The Internet, ‘intranets’ and the World Wide Web ..............................21 Virtual communications and virtual relationships ................................25

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KNOWLEDGE MANAGEMENT – THE PEOPLE DIMENSION

30

Introduction ...............................................................................................31 People management policies and practices in the knowledge environment ................................................................31 Motivating and rewarding knowledge workers ...................................32 Recruitment, retention and succession planning in a knowledge environment ...................................................................36

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Impact of knowledge management on the role of managers ..............39 Training and development in a knowledge environment .....................42 Team working in a knowledge environment .........................................43

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KNOWLEDGE MANAGEMENT – THE ORGANISATIONAL DIMENSION

47

Introduction ...............................................................................................48 The cultural challenge of effective knowledge management ...............48 New organisational forms in the knowledge economy ........................55 Identifying knowledge resources – knowledge audits .........................58 Transferring knowledge – A ‘merger’ case study .................................60

5

CONCLUSION

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Lessons from the growth in knowledge management .........................64 Political and regulatory perspectives on knowledge management and the knowledge economy ...........................................66 Preparing for the future in the knowledge driven economy ...............68

APPENDICES

70

1 Case studies ...........................................................................................71 2 Summary checklist: Introduction to knowledge management ....... 86 3 Summary checklist: Knowledge management – the systems dimension ..................................................................... 87 4 Summary checklist: Knowledge management – the people dimension ........................................................................ 88 5 Summary checklist: Knowledge management – the organisational dimension .......................................................... 90 6 References ............................................................................................ 92 7 Further reading .....................................................................................94

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Introduction Knowledge management is not a new concept. Managing knowledge, using it to do things better, more effectively, more aesthetically, or just differently has been a continuing feature of human societies and human culture. Organisations, in both the public and private sector, have always managed knowledge in one shape or another. What is new is the development of a separate discipline called ‘knowledge management’. The development of recognised techniques and recognised approaches for effectively managing the knowledge resources of an organisation. The purpose of this Report is to introduce the reader to the central ideas and concepts of this discipline. What gives this urgency is the growth of the knowledge economy. An economy based on developments in information and communications technology and on the ways of working growing-up around the Internet, intranets and the World Wide Web. Success in this new economy, whether in the provision of goods and services or the delivery of public services, will be dependent on obtaining maximum added value from the knowledge resources available to an organisation. Hence, the importance of knowledge management. Within knowledge management there is a continuing debate about the nature of knowledge. Some experts view knowledge as an object. Something that can be managed directly, traded and shared like any other commodity. In this view, knowledge shares many of the qualities of information. Other experts see knowledge as the product of a complex interaction between human beings and information. In their view it cannot be managed directly but only through the management of people and the complex web of systems and processes which surround them. In this Report we have tried to steer a pragmatic course between these different views of knowledge. There is no single definition of knowledge management. For the convenience of the reader, in Chapter 1 of this Report we provide a working definition of knowledge management together with an explanation of the key concepts. In practice, organisations involved in knowledge management generally arrive at their own definitions relevant to their own context.

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INTRODUCTION

In the subsequent chapters we consider the technological, people and organisational issues involved in knowledge management. Finally we consider some of the wider issues within the knowledge economy and the key lessons to be learnt from the development of knowledge management practices. In the appendix are case studies, summaries of key points from the first four sections and a guide to printed and Web based resources for those wishing to pursue the subject further. Sue Brelade and Chris Harman

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KNOWLEDGE MANAGEMENT MAP

Knowledge management map Relevance of knowledge

Knowledge technology

Knowledge and people

Knowledge and organisations

Knowledge economy

Collaborative working

Knowledge workers

Structures and culture

Commercial imperatives

Communications technology

Management in a knowledge environment

New ways of working

Customers, consumers, citizens

Data storage and retrieval

Creativity and innovation

Creating knowledge

E-commerce and e-world

Virtual world

People management policies and practices

Trust and relationships

Knowledge mapping

Artificial intelligence

Tacit knowledge

Organisational learning

Knowledge assets

Access to knowledge

Rewarding knowledge

Corporate memory

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Chapter 1 Introduction to knowledge management Introduction Definitions of knowledge management The language of knowledge management Drivers for knowledge management Knowledge management activities

Chapter 1 Introduction to knowledge management

Introduction In this chapter we will introduce the key concepts and terminology of knowledge management. We will look at defining knowledge management and provide a working definition and we will look at the drivers for knowledge management, both within the public and private sectors, and typical knowledge management activities.

Definitions of knowledge management In each of the organisations we have studied, knowledge management is given a different definition. The language used to define knowledge management shows a high degree of contextualisation and relevance to the particular business sector. In one particular organisation, it was defined as the process of transferring knowledge from one place to another, thereby solving a problem effectively and quickly. In another it was seen as being a systematic approach to enabling people to access and use relevant information and as the ability to distinguish the ‘wood from the trees’. Another organisation described it as ‘the sharing of information amongst the community that makes up the organisation’. In a large utilities group it was seen as the process of ‘linking the right people to the right information at the right time’. Much emphasis was also placed on the relevance of the information and the fact that relevance changed and was context and need dependent. Common to the various definitions were the two dimensions of people and information. Knowledge management lies in the relationship of these two dimensions, mediated by systems and processes. It is generally seen as an holistic approach which recognises the inter-dependency for the organisational effectiveness of people, the technology they use and the systems and process within which they use it. Later on in this Report we will also consider the importance of an organisation’s culture to this relationship.

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A model of knowledge In one organisation we looked at, the first stage in a corporate knowledge management initiative was to bring together various managers into a ‘knowledge management forum’. The model for knowledge adopted through this ‘workshop’ process is reproduced below.

What is knowledge?

Wisdom Experience Knowledge Learning Information Organise Data

Figure 1.1: A model of knowledge The different stages of this hierarchy can be described by the analogy of someone learning to ski. The ‘data’ stage would be buying the skis, the ‘information’ stage would be using a book on skiing as an aid to learning how to ski, the ‘knowledge’ stage would be being able to ski – actually having the experience of skiing. Finally the ‘wisdom’ stage would be realising that you don’t ski ‘off piste’ in bad weather. Another view on the relationship between knowledge, information, data and wisdom is that data has no context. When it is put into context it becomes information. When the links between different pieces of information are formed and the patterns apprehended it becomes knowledge, when the underlying principles behinds those patterns are understood it is wisdom. In the organisations we spoke to, a common view about knowledge management was that it was not an end in itself but a means to an end. Similarly, it was thought that knowledge alone has no power, in that it requires human decision

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and action to acquire power. However, there was an interesting divergence between two underlying approaches to knowledge management. In one view the role of knowledge management was seen as nurturing the process of knowledge creation. The other view was that it was the process of managing and measuring knowledge. In the former approach, knowledge is seen as an emergent characteristic, in the latter it is seen as an object. This divergence may reflect an underlying distinction between two ‘types’ of organisation. The first ‘type’ are those involved in developing new products and ideas for the market. For these organisations fostering innovation and creativity are key drivers for knowledge management. The second ‘type’ are those more established organisations that have a wealth of accumulated knowledge and intellectual capital. For these organisations the issue is first to know what knowledge resources they have and then to leverage maximum value from them. In looking at various organisations, it quickly becomes apparent that knowledge management is as much about culture and behaviour as it is about technology and processes. Whether the culture of the organisation is one that values knowledge resources, whether it values people and their ‘know how’ and whether it has an approach to management that fosters innovation, creativity and collaboration. We would suggest that it is unlikely that one would find effective knowledge management in a macho, ‘hire and fire’ type culture. The cultural aspects of knowledge management are dealt with in more depth in Chapter 4 of this Report. The link with culture means that any working definition of knowledge management needs to be drawn more widely than simply people, information, systems and processes. The working definition we have adopted for knowledge management is as follows: ‘Knowledge management is the acquisition and use of resources to create an environment in which information is accessible to individuals and in which individuals acquire, share and use that information to develop their own knowledge and are encouraged and enabled to apply their knowledge for the benefit of the organisation.’ (1) When we talk of resources in this definition, we include physical resources (such as IT systems), financial resources, ‘intellectual’ resources and people. Creating the environment in this definition is not just the right physical or technical environment but also the right working environment, the right culture. In this case the ‘right’ culture is one that encourages and enables individuals to want to use their knowledge for the benefit of the organisation. In our experience, it is surprising the number of organisations that assume that because they pay people, those

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people will use their knowledge for the benefit of the organisation. Paying people is a contractual relationship and only buys what is contracted for. True creativity and innovation require the will on the part of the individual to give more than can be bought with a contract. This is something we will consider further in Chapter 3.

The language of knowledge management Where specific knowledge management projects are put in place, a common starting point is to spend time with managers, at the outset, clarifying the ‘language’ of knowledge management. This is based on the idea that with a shared language it is possible to achieve a shared understanding and a shared value set – essential elements in any successful project. With a developing discipline, such as knowledge management, the ‘jargon’ is likely to change and develop as understanding grows. Similarly, as a relatively new discipline with many theoretical issues to resolve, what is meant by some of the terminology is not always clear, even to experienced practitioners. Because of this the approach of pooling understanding and agreeing ‘in-house’ working definitions of the main concepts has much to recommend it. The guide below is provided to introduce the reader to the main concepts and the associated language within this evolving discipline.

The main concepts and the associated language of knowledge management Corporate memory – the cumulative experiences within an organisation, often embodied in long serving members of staff, particular processes and systems, archives and also in the cultural ‘ways of doing things’. Corporate memory, when effectively harnessed and integrated, can bring past experiences and lessons learnt to bear on current issues and problem solving. Effective use of corporate memory is also seen in avoiding making the same mistakes twice. On the negative side, failing to recognise a changed situation where a previously unsuccessful approach may now work can indicate an overly dominant corporate memory that stifles creativity and innovation. It is interesting to note that management trends such as ‘down-sizing’ and the high levels of early retirement have a negative impact on corporate memory and, by extension, effective knowledge management.

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Data-mining – the process of investigating or interrogating large databases (including ‘data warehouses’) to find relevant information. With the vastly increased capacity for online storage, finding relevant data (i.e. information) is becoming an increasingly difficult and skilled task. Explicit knowledge – used to refer to codified information (knowledge) that can be shared, communicated and transferred from one place to another in systematic or structured ways (for example in a written document). The explicit knowledge in an organisation includes the contents of databases, operating procedures, documented processes etc. (‘explicit knowledge’ is often contrasted with ‘tacit knowledge’, defined on page 11). Information economics – the study of the tangible value of information to an organisation. Particularly relevant in the concept of ‘knowledge brokering’ to determine the appropriate cost for acquiring information or value to trade information. Intellectual asset management – covering management of intellectual property, patents, copyright etc. Knowledge analysis – a knowledge analysis is commonly used to describe a detailed analysis of the strengths and weakness of a ‘knowledge source’. An example would be an analysis of the use of an intranet in knowledge management. Knowledge audit – the process of identifying what knowledge the organisation already possesses and where it could be found, together with the knowledge the organisation needs but does not yet have. A knowledge audit covers the skills and knowledge of people as well as the entire intellectual assets of an organisation including documented systems and processes as well as intellectual property such as copyrights and patents. Knowledge brokering – based on the idea that ‘knowledge’ is a commodity and that the knowledge economy is a new market where knowledge can be traded. As in any marketplace, middlemen connect buyers and sellers. The classic example of a knowledge broker is the consultancy which may not itself have the knowledge you require but can introduce you to someone who does. Knowledge capture – the process of identifying and recording knowledge. This can include ‘exit interviews’ with departing members of staff as well as detailed analysis of particular jobs or processes to identify the knowledge being applied. Knowledge engineer – traditionally used to refer to a person involved in expert systems development. It is, however, increasingly being used to refer to those involved in developing systems and processes within organisations that are designed to capture and utilise knowledge resources.

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Knowledge mapping – this involves identifying where knowledge exists (usually inside an organisation but it can include external sources) and producing a guide to locate it – whether a simple directory listing or a more sophisticated Web page with hyperlinks to databases, archives etc. The idea is that the knowledge map can be used to navigate through the knowledge resources and find the relevant knowledge or source of knowledge. Knowledge needs analysis – this phrase is used to describe the process of identifying the knowledge requirements to deliver a particular objective and the ‘gap’ with what currently exists. Knowledge organisation – this phrase is used in various ways. It can refer to an organisation whose primary assets and/or products are intellectual, or an organisation that has mastered the art of leveraging value from its knowledge, or simply an organisation that values knowledge. Knowledge planning – knowledge planning generally encompasses an analysis of future requirements in terms of systems, people and technology. It will also involve planning for the ‘retirement’ and replacement of those resources. Knowledge preservation – used to refer to capturing and archiving knowledge and systematic processes for ensuring knowledge is not lost. Knowledge requirements – the ‘know how’ – people, information, systems and the infrastructure that an organisation needs to deliver its objectives. Knowledge technology – this is often used to refer to IT systems (particularly expert and ‘artificial intelligence’ applications). However, it can equally be used to describe the printing press and the quill pen. Knowledge transfer – for some practitioners this is viewed from the tactical perspective of converting knowledge into working solutions. For others, it is seen as the ability to literally move knowledge from one place to another (whether a physical place such as an office block or a mental place such as a person’s mind). In a merger or acquisition where people may be leaving, their knowledge needs to be captured and transferred to the new organisation. Knowledge worker – someone whose basic ‘tools of the trade’ are their knowledge and experience. Traditionally associated with high paid individuals, either employees, contractors or consultants. Sometimes used to refer to people who work with information. In the knowledge economy most employees are becoming knowledge workers.

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Tacit knowledge – this involves an assumption in knowledge management that there is personal and context specific knowledge that is not explicit. Examples include the knowledge embedded in people’s experiences and linked to their own beliefs and perspective. Part of the aim of many knowledge management initiatives is to make the tacit knowledge of individuals explicit, by bringing it into the public domain. This is considered further on page 11.

Tacit knowledge There is considerable discussion within the field of knowledge management about ‘tacit knowledge’. Some practitioners see it as being impossible (by definition) to bring into the public domain. Other practitioners see bringing tacit knowledge into the public domain as central to knowledge management and have developed various techniques for doing so. These techniques tend to centre on working with individuals and groups (using structured interviews, focus groups, job and task analysis and recording of activities) with the aim of making explicit the knowledge that individuals are applying in their work or to their particular functions. Within the world of artificial intelligence, much research has gone into identifying how judgements and decisions are made by individuals to try to develop similar processes in expert systems. A particular difficulty with ‘codifying’ tacit knowledge arises where the knowledge is closely linked to the human state – our particular experiences, emotions and thought processes. This is seen in areas where success depends upon interpersonal skills and relationships – most of us do not deal with relationships following a set of codified ‘rules’ or procedures. In areas where relationship management is central to business success this poses particular challenges for knowledge management. For example, within call centre environments, relationship management has focused on ensuring that those dealing with calls have detailed information available to them about their customers. This involves the use of Computer Telephony Integration (CTI) which brings up on screen corporate knowledge about the customer. On the World Wide Web, relationship management has focused on collecting information on ‘surfer’ habits through various means including ‘cookies’ (packets of information stored on the ‘surfers’ computer by web sites they visit). This enables ‘banner’ advertising (adverts that ‘pop-up’ on screen as you browse the Web) to be tailored to the customers interests. In both cases, CTI and on the Web, the intention is to tailor the service to the customer, making it both efficient and more effective in generating sales. Both approaches would fit under the heading of ‘relationship management’. However, real relationships are

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not based purely on the exchange of information. Knowing about a person is not the same as knowing the person. In a call centre environment it is noticeable that some staff are able to build a relationship with customers whilst others, with the same information available, are not. The difference lies in the tacit knowledge and understanding embedded in the interpersonal skills of the staff member.

Drivers for knowledge management In a large part, the drivers for knowledge management are similar to most drivers for change within the commercial and public sectors. The need for commercial organisations to obtain competitive advantage and the need for public sector organisations to deliver more with less. Knowledge management is seen as meeting these requirements through the ability to leverage a unique asset – the knowledge base within the organisation. The development of the ‘knowledge economy’ has also created drivers for effective knowledge management. This can be seen in the increasing number of organisations whose product and services are intellectually based. These include newer industries in the technology sector as well as more established sectors such as public service, media, financial services and similar. In these organisations, being able to effectively deploy the intellectual resources of the organisation is not only central to business success, it is often the essence of the business. There are further drivers for knowledge management that have their origins in the development of the ‘knowledge economy’. For the public sector, the development of this new economy has created a new level of expectation from the public. This is seen in one of our case studies where the concern of the organisation is not just about effective and efficient service delivery. As a public body it is pursuing knowledge management as part of achieving social policy objectives. These include; achieving increased social inclusiveness, facilitating the involvement of service users in service development and strengthening local democratic processes. It is important to note that for a public body, the ‘knowledge base’ to be leveraged in the desire for improvements is not confined to the employees of the organisation but encompasses citizens generally. For commercial organisations, the development of the ‘knowledge economy’ has followed an equalisation of access to information and techniques. These are no longer the preserve of the large organisations, or those who can afford the expensive consultancies. Total Quality Management, business process re–engineering, workflow and activity management and similar disciplines are widespread and

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understood. Against this background, high levels of operating efficiency become the norm rather than an exception. This perception has led some organisations to see knowledge management as a new way of achieving differentiation from their competitors. From this perspective it offers an opportunity to gain maximum advantage from the knowledge base already present within organisations and to separate out the ‘best’ organisations from those that are merely ‘good’. The Government White Paper ‘Our Competitive Future: Building the Knowledge Driven Economy’ (2) identifies the following as drivers within the knowledge economy: •

Competition from low cost economies

•

Increasing innovation in products, processes and services

•

Electronic commerce radically changing the way business meets customer demands

•

Science and knowledge underpinning the new technologies.

The White Paper also maintains that knowledge, skills and creativity are ‘the distinctive assets in a knowledge driven economy’ and essential in order for the UK to have a competitive edge within a global marketplace. The two roles of business according to the White Paper are to: •

‘Encourage and support all their employees continually to develop their skills and qualifications.’

•

‘Identify, capture and market the knowledge base that drives all products and services.’

In practice, we found the drivers for knowledge management included a combination of internal and external factors. Amongst those identified were: •

Increasing efficiency and productivity

•

Reducing the risk and costs of ‘getting things wrong’ and avoiding ‘re-inventing the wheel’

•

Addressing increasingly complex issues (particularly environmental ones)

•

Responding to globalisation

•

Mergers creating the need to share knowledge more broadly

•

Greater access to R & D

•

The need to reduce product development time.

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One of the organisations that we spoke to, which operates in the highly competitive field of managed services, had clearly identified the role of knowledge management as a means to: •

Differentiate their company within a highly competitive marketplace

•

Maintain the company’s position at the forefront of managed services

•

Facilitate an increasingly global approach to management.

In the various organisations that we looked at, the value of knowledge management as a response to externally and strategically driven issues was clearly articulated. However, practical knowledge management projects were more often specified in terms of internally relevant issues. Particular objectives included: •

Capturing, organising and verifying specific information and historical data

•

Reducing the time delay before new recruits became productive

•

Integrating and making accessible diverse sources of information e.g. archives held departmentally and corporately, individuals ‘working files’ and personal records, quality assurance documentation

•

Developing an intranet that gave access to useful information

•

Developing a systematic process of ‘de-briefing’ outgoing employees to ensure key knowledge was identified and captured

•

Identifying what was needed in order to acquire and record new knowledge in a readily accessible form

•

Taking action to find and preserve existing knowledge (implicit and explicit) in a readily accessible form

•

Developing methods of effectively sharing and exploiting company knowledge.

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NEED FOR KNOWLEDGE MANAGEMENT

Competition

Customer and citizen expectation

Technology

Globalisation

Figure 1.2: The drivers for knowledge management

Knowledge management activities In response to the drivers identified above, organisations both in the public and private sector are engaged in a range of knowledge management activities, although few have a written knowledge management strategy. Typical activities include: •

Auditing knowledge ‘assets’ and identifying knowledge gaps

•

Revising personnel policies and practices

•

Investing in information and communications technology (ICT) and developing knowledge based ICT strategies

•

Developing new ways of encouraging innovation and creativity amongst employees

•

Developing new approaches to team working and redefining the management role

•

Changing organisational structures.

These areas are dealt with in more detail in the remaining chapters of this Report.

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Chapter 2 Knowledge management – the systems dimension Introduction Technical perspectives on knowledge management The Internet, ‘intranets’ and the World Wide Web Virtual communications and virtual relationships

Chapter 2 Knowledge management – the systems dimension

Introduction In this chapter we will look at the technical and IT related aspects of knowledge management, the direction technology is taking and its current and likely future impact on organisational practices.

Intranet Intranet

Computer Computer telephony telephony integration integration

Search Search engines/ engines/ data-mining data-mining

Groupware KNOWLEDGE MANAGEMENT

Work Worktracking tracking and andwork-flow work-flow management management

Internet Internet

Extranet Extranet

Business Business analysis analysis and anddecision decision support support

Figure 2.1: Knowledge management systems

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Technical perspectives on knowledge management As a result of strategic information systems being seen to be critical, many organisations have, since the 1980s, been investing heavily in information technology. Alongside that investment, organisations have developed IT strategies. The focus of many of the early IT strategies was to regulate user behaviour, ensure common standards and compatibility between different applications and different technologies, facilitate corporate databases and, with the advent of e-mail, corporate communication systems. This investment in new technologies has not necessarily led to improved organisational performance or business success. Paul Strassman (1), has argued that: ‘There is no relationship between computer expenditure and company performance. The key factor in maximising the return on investments in new information technology is the effective use of information as it relates to the performance of the particular organisation.’ This shift from a technical focus on what the technology can do, to a focus on what people can do with the information it makes accessible, is at the heart of the systems dimension of knowledge management. The shift in focus means looking at the technology from the perspective of its ability to facilitate individual access to information and knowledge, to enable the sharing of ideas and experience, to facilitate communication and to remove barriers to creativity and innovation. In the organisations we looked at, the key drivers in technological development were to give people access to the information they need, when they needed it and to provide them with the applications to use that information and to share it. It was the interaction between the information delivered through the technology and the experience and knowledge of the individuals that was seen as creating an environment of innovation. Technology was seen as providing the solution to the storage of information and codified knowledge. It was also seen as providing efficient search and retrieval facilities, as well as being an effective communications tool. Technology was also being used to remove the traditional barriers to collaborative work created by geographic location. The technologies of the 1980’s were essentially systematic and ‘linear’, designed around data storage and retrieval. These still have their place in the form of data

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warehouses and databases. However, the newer technologies are flexible, nonlinear and designed to reflect and support the innovative and creative capacity of individuals.

TECHNOLOGIES

THEN 1980s

NOW 2001

Systematic Systematic Linear Linear

Flexible Flexible Non-linear Non-Linear

Figure 2.2: Technologies

Typical applications being used as part of knowledge management in the organisations we looked at included: ‘Groupware’ – software that supports groups of people engaged in a common task or goal was being used to allow people to collaborate on projects irrespective of geographical location. Typical groupware products provide a calendar, scheduling, web navigational tools and e-mail, as well as information sharing functions and messaging. ‘Computer Telephony Integration’ (CTI) – being used to enable staff responding to a customer telephone call to immediately access the organisation’s stored information about that customer, allowing a more tailored response. Being able to access customer profiles means that the member of staff taking the call can better understand what the customer values and what the customer needs. Likewise, having access to the right customer information quickly can ensure that complaints or concerns are solved rapidly. Having access to the relevant information also means that the member of staff can anticipate customer requirements as well as analyse any particular buying trends. For the salesperson, being able to bring up on screen the relevant information also meant

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increased opportunity to ‘up-sell’ and ‘cross-sell’ any new product or services. Using technology in this way utilises the stored knowledge of the organisation, to impact on the bottom line and on the levels of customer service. ‘Work-tracking and work-flow management software’ – allowing organisations to improve the management of projects and tasks, providing instant feedback on progress, generating monitoring statistics and ensuring that the correct steps in particular processes were being followed. Tools for analysing business data allowing trends to be quickly identified and informing business decisions. A more complex area is product development where knowledge management was identified by one of the organisations we looked at as the primary mover in reducing product development times. This is an area that can add significant value to the business as a whole, ensuring that products are improved or new ones are created before that of the competition. The technology involved in this can include the communications technology to build teams on a global basis, work tracking applications to keep projects on time, the business intelligence and analysis software to feed into the product design process and the Computer Aided Design and manufacturing capability to deliver the product. If a company isn’t managing its knowledge effectively they will find it difficult to keep up with the changes in requirements of customers and the expectations of customers. One of the main things that businesses can be assured of is that change is constant and that they need to continually improve their systems and their people in order to be competitive. In the knowledge economy, employees need easy and quick access to the right information and they also need the technology that will support their innovation and creativity.

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The Internet, ‘intranets’ and the World Wide Web The Internet and the World Wide Web The Internet and the World Wide Web have developed at a rapid pace into a major means and resource for gathering and exchanging information. Within the UK, 91% of employees now work in businesses that are connected to the Internet, 62% of UK businesses have a web presence and 45% of UK households are on-line with 47% of UK adults being regular internet users. Within many organisations ‘internal’ versions of the Internet (‘intranets’) are being put in place. These allow the same, browser based, navigation between ‘pages’ as on the World Wide Web. Some organisations are also developing ‘extranets’ – essentially an intranet that encompasses groups and individuals outside the organisation (for example, suppliers, customers, community groups etc.). The development and the popularity of Web based technology has created an opportunity for different approaches to collaborative working and the sharing of knowledge and expertise – what can be referred to as ‘knowledge creation and diffusion infrastructures’. It also enables organisations to create a platform for interactive working and a ‘knowledge repository’ accessible from anywhere in the world at a relatively low cost. In essence the Internet can act as a platform for collaborative knowledge management without regard to geographical restrictions. An example of this, from one organisation, was a Web based project management site. It was being used to manage a research project with a virtual team comprising members of different organisations from across the UK and Europe. The secure site was hosted by the ‘project sponsor’ organisation, who also directly employed the project manager. The members of the virtual team could feed in results, interim reports and project data onto the site. All the members of the team could access the data. In addition, as part of the financial control systems for the project, the financial control data entered onto the site by the partners in the project would automatically update the financial systems of the project sponsor. A non-commercial example of using the Web to draw a large number of people into a collaborative network is the Search for Extra Terrestrial Intelligence (SETI) screensaver. This can be downloaded from the Internet and, when the users computer is idle, will receive, analyse and return SETI data.

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The development of secure areas on the Web, accessible by members of virtual teams, provides a structured, low cost, workspace. Providing remote access over the Web to internal systems and databases extends the functionality of team members when geographically distant. Equally useful for effective knowledge management is allowing access to the Web for employees from their workplace. It puts at their fingertips a considerable repository of information and knowledge, although the ‘unstructured’ nature of the Web can make locating information a difficult and time-consuming task. Even the best of the current publicly available ‘search engines’ will often return as much relevant as irrelevant data, particularly if the search criteria are loosely set. In one of our case studies it was noted that a primary limitation in the development of a public access community information system was the current limitations of search engines. To resolve this problem, further development of ‘intelligent agents’, software that effectively scans the Web searching for the information that you require within the parameters you set, offers the most promising solution.

Intranets Intranets, the ‘in-house’ version of the World Wide Web based on Internet technology, create a common corporate communications and information sharing system. They can be used on a ‘push’ basis – where information is presented to employees – and on a ‘pull’ basis – where employees seek out and retrieve information for themselves. ‘Push’ technology is used when it is important that certain material is presented to employees at their workstation. It ensures that no other function takes place until all the information is correctly accessed. Examples of the types of information that we found being ‘pushed’ to workstations included: •

Price changes to products

•

New products or product updates

•

System alterations

•

Key briefing information and corporate announcements

•

Tests for employees to complete so that new knowledge acquisition can be established (this example was in a financial services organisation. The regulatory requirements meant that the organisation had to ensure levels of competency amongst staff involved in selling financial products. As part of that the intranet allowed tests to be distributed to workstations and the results sent back to the administrator who could then collate the results to provide the necessary ‘evidence of competence’ to the regulatory authorities.)

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•

Health and Safety Workstation Assessments (this example required individuals to complete a workstation assessment, again with the results being sent back centrally to be collated).

‘Pull’ technology however, allows the employee to decide when to pull down information from the intranet that they wish to view. To provide a seamless experience between viewing Web pages on the World Wide Web and viewing information on an in-house intranet, access is usually via a standard Internet browser.

Health and safety information Information on departments Customer information

TYPICAL

Supplier lists

INFORMATION

Training

THAT CAN BE

Company newsletters

ACCESSED ON

Staff details (eg telephone extensions and photographs)

AN INTRANET

Company policy/staff handbook Minutes of meetings

Figure 2.3: Intranet content Organisations that we looked at were also including: •

Agendas and minutes of senior management meetings

•

Agendas, minutes and reports for project meetings

•

Information being sent to staff for consultation

•

Special events

•

Areas for staff to publish their own information

•

Union information

•

Announcements

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•

Online job application forms and job vacancies

•

Interactive staff surveys.

The perceived benefit, by employees, of using an intranet will be a large determinant of its success. In the organisations we considered, these benefits were variously summarised as: •

Greater feeling of involvement and participation in the life of the organisation

•

Feeling of being valued through sharing and receiving feedback on work

•

Ability to identify resources and relevant skills, especially when putting together new teams for a project

•

A feeling that the information being received was authoritative and accurate – rather than receiving messages second or third hand they could receive them directly from the Chief Executive or other senior managers

•

Ability to access information relevant for their jobs, with considerable time saving on hunting through files

•

Able to make better decisions based on a fuller picture and an understanding of the organisations’ strategic direction

•

Fewer surprises when changes were being made as they were always signposted on the intranet, for example in the minutes of management meetings

•

A stronger ‘community’ feel.

The main limitation to the information to be placed on intranets is the resource needed to maintain it and keep it up-to-date. This in turn reflects the level of commitment to the intranet and the extent that it becomes part of the fabric of organisational life. As one manager commented: ‘It’s only been fully in place for a year, but its difficult to imagine going back to before we had it. It’s the first port of call if you want a report or piece of information. It’s the first place you look if there are changes going on and you want to know what’s happening.’ In this organisation, each department had trained users who were responsible for updating departmental information on the intranet. In another organisation that we looked at, the personnel system was accessible through the intranet. Access was controlled through passwords but all staff could use the intranet

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to update their personal information, enter training records, apply for leave, fill in sickness forms and similar. This functionality helped to integrate the intranet into organisational life whilst at the same time ensuring that the personnel database was being kept more up-to-date than it had been previously, with less administrative burden on the personnel department. It also enabled managers to access accurate personnel information and statistics directly for decision making and planning purposes as part of the knowledge management process.

Virtual communications and virtual relationships Probably the most significant impact for individuals of new technology has been the advent of e-mail. In many organisations it has become an integral part of the communications process, both within the organisation and between the organisation and the external world. For knowledge management it is one of the key components in the sharing of information and ideas. Although not always recognised, the information contained in e-mails is also a considerable knowledge asset that needs to be managed – a task that many organisations have not yet mastered, with unclear guidelines on what sort of e-mails need to be archived and stored, which can just be deleted and so forth. Sometimes this can have serious consequences, the authors know of one example where a court case had to be settled to the detriment of the organisation, on the production of an email which the plaintiffs possessed but which had not been retained by the originator within the organisation. As a communications tool, e-mail cannot be managed in a hierarchical fashion. It is an open and difficult to regulate communications medium. Just as it can be used to communicate productively for the benefit of the organisation, it can also be used negatively. It can be used to help build the knowledge base of an organisation; it can also be used to send valuable information to any destination inside or outside the organisation. Most organisations would probably be surprised to find out how much of what they would consider ‘their’ information is being shared by their staff (as attachments to e-mails) with people outside of the organisation. Often this is fellow professionals helping each other through professional networks which, as a reciprocal arrangement, can work to the benefit of the organisation. Sometimes it is less benign.

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Whilst e-mail enhances the ability of people to consult widely on a document or report, this can have negative impacts in a traditionally managed organisation. The problem arises when there is a culture of ‘if you can consult with someone, you must consult’. In these situations, a report that might have involved one or two people suddenly finds inputs coming from many people. Whilst the end product may be better, the time it takes to produce is not increased despite the technology. An important paradigm that many organisations involved in knowledge management have recognised is that new technology is often more effective if combined with new ways of doing things, rather than when seen as a way of improving old ways of doing things. Improved communications technology, increased speed and increased complexity do not of themselves produce better management of knowledge. Whilst the technology can encourage and facilitate knowledge management, an organisation that has never generated innovation and creativity within its staff is unlikely to do so simply because of the introduction of technology. It is the management of the human dimension and the creation of the right culture that will make the difference. The authors are mindful of an organisation that decided to embark on a knowledge management project. It looked into the matter and decided that effective knowledge management was an ‘archives and records’ issue. It decided that the way forward was electronic record management, a project to be led by the records manager. Whilst a commendable start, it is a narrow perspective reflecting more the culture of the organisation than the real potential of knowledge management. This is not the only example of an organisation running the risk of making the ‘chief knowledge officer’ into a ‘chief librarian’ and knowledge management into information management. Where the communications and collaborative working technology is being used effectively, organisations have been able to develop cross-functional and global teams, harnessing and directing a range of talents, abilities and knowledge towards tasks they need carried out. The use of virtual teams, whose meeting place is in cyberspace and who communicate through e-mail and similar applications, allows teams of fluctuating size to be quickly formed and disbanded as needed. Additional team members can quickly be brought on board and others can leave as they move to other projects.

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COMMUNICATION AND COLLABORATION

In-house/physical In-house/physical location locationspecific specificteam team

In-house In-housephysical physical cross-functional cross-functionalteam team

Virtual Virtualglobal globaland/or and/or cross-funtional cross-funtionalteams teams

Virtual Virtualnational nationalspecific specificand/or and/or cross-functional cross-functionalteams teams

Figure 2.4: Communication and collaboration

However, studies in cognitive sciences (3) suggest that although different perspectives on a problem develop a deeper understanding of it, too much knowledge and information can lead individuals to experience a ‘cognitive overload’ which reduces effectiveness. This is a common complaint of knowledge workers – that the volume of information induces a form of mental ‘paralysis’, stifling rather that facilitating innovation and creativity. For knowledge management this indicates the importance of effective search and navigation tools when accessing information, knowledge filtering processes and the importance of effective design for the user interface between individuals and knowledge sources (e.g. data stores). Dependent upon the security access levels required the fact that virtual team interaction takes place in cyberspace means that it can be made accessible to non-team members. Other members of the organisation can link in to the work of virtual teams through accessing ‘threaded’ discussions in cyberspace and other team communications. This can allow people outside the team to keep abreast of what the team is doing, make a contribution if they feel it will help and join the team if asked. Never before have organisations had the opportunity to bring such a diverse range of knowledge experience and understanding to bear on any particular issue or problem.

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There is a danger with the development of this type of approach that, although results are delivered, the knowledge gained in the process is lost. This is because it is fragmented and contained, not in files at the head office, but in the individual computers and logs of the virtual team members, which could be scattered across the globe. This presents a knowledge management challenge – of turning the scattered, diverse knowledge of their knowledge workers, who are working in a virtual team, into a well structured ‘knowledge repository’. Spek and Spijkervet (4) identify three basic activities necessary to achieve this: 1.

Creating knowledge

2.

Securing and combining knowledge

3.

Distributing and retrieving knowledge.

In this type of model for virtual team working, the ‘creation of knowledge’ is seen as arising from the process of developing ideas or solutions, feedback being received from other members of the team or externally and the feedback leading to the development of revised or new ideas and solutions. ‘Securing and combining knowledge’ is seen as the process of storing and indexing knowledge and ensuring that all team members can share (that is access) the stored knowledge, understand it and integrate it with their own knowledge. The storing and indexing needs to be a dynamic process to allow for updating, modifications and amendments to the contents of the knowledge repository. ‘Distributing knowledge’ needs open, flexible, and reactive communication channels. It is seen as an essential part of virtual team working to fuel the ‘learning process’ inherent in developing new ideas and creative solutions. Retrieving knowledge once stored on the collaborative systems is essential if the ‘knowledge repository’ idea of the shared cyber-workspace is to have any value. However, the dynamic nature of the environment is seen as requiring sophisticated search tools rather than simple ‘key word’ searches – covering both context and content. This is an area identified in our case studies as one where weaknesses exist. As one manager commented: ‘The corporate systems are well organised and documented. That’s where the resources go. But if you look at the information held electronically by individuals, nine times out of ten it’s pretty haphazard. Navigating it is more about psychology than systems – you need to know how they think.’

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The technology that organisations are employing are technologies that provide flexibility to the business and provide customers with a quick customised solution. In a knowledge management environment it is important to capture experiences and ideas in a central deposit and also to provide information that is personalised to customers and to staff. This is done through content management technology, which provides individuals with the ability to manage documents as well as the content of those documents and it also allows searches across web sites and files and databases. Other areas that could facilitate knowledge flow within an organisation identified by Microsoft (5) included the digital dashboard, which managers could use daily to log important information for that day and the use of a wireless network so that users could access up-to-date information on laptops, personal phones and mobile phones. The basic role of technology in knowledge management can be briefly summarised, in functional terms, into the areas of: •

Facilitating communication

•

Enabling collaboration

•

Collecting information

•

Storing information

•

Analysing information

•

Disseminating information

•

Updating information.

It is however important to note that knowledge is not just contained in an organisation’s database systems. It is also contained in e-mails and memos with suppliers, customers and competitors. Most importantly, it is contained in the minds of individuals. It is the management of individuals to maximise the benefits of that knowledge that we shall consider in the next chapter.

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Chapter 3 Knowledge management – the people dimension Introduction People management policies and practices in the knowledge environment Motivating and rewarding knowledge workers Recruitment, retention and succession planning in a knowledge environment Impact of knowledge management on the role of managers Training and development in a knowledge environment Team working in a knowledge environment

Chapter 3 Knowledge management – the people dimension

Introduction In this chapter, we will consider the challenges that knowledge management creates for how organisations approach people management, the areas of recruiting, rewarding, managing and developing knowledge and knowledge workers. We will also identify the challenges facing the managerial role in the knowledge economy and consider new paradigms for defining managerial effectiveness.

People management policies and practices in the knowledge environment An emphasis on knowledge, skills and creativity and on the capturing and sharing of information, are all issues that impact upon how people are managed. In many organisations responsibility for these activities is often focused within a specialist HR or personnel department. Over the past few years there has been an increasing interest from personnel specialists in the area of knowledge management and the contribution they can make both individually and as a profession. This has been reflected in the conferences and publications of the Chartered Institute of Personnel and Development. For personnel specialists there are particular hurdles to overcome to make a contribution. Knowledge management is itself a multi-disciplinary area and it is necessary for personnel specialists to work with other disciplines, often having to develop new skills and understanding (particularly in the area of technology). Personnel specialists also have the conflict inherent in reconciling seeing people as a cost to be controlled and as an asset to be developed.

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A key role for personnel specialists is to help bridge the gap between what people know – the information and expertise they have available to them – and what they do. In the knowledge economy, it is what people do with their knowledge that is the driver for competitive advantage rather than the investment in information systems, intranets, and electronic communications. Effective knowledge management is not possible in an environment where people are disenchanted, de-motivated and demoralised.

What people know

People management policies and practices

What people do

Figure 3.1: Bridging the gap

Motivating and rewarding knowledge workers The first and most obvious area of involvement for personnel specialists is in the area of reward management. Reward management is a broader concept than just managing the pay system. Rewards can take many forms other than cash and reward management will deal with the formal and informal ‘recognition’ that employees receive, the types of behaviours that the organisation reinforces and the types of behaviour that lead to promotion and progression. An example of a non-pay reward that reinforces knowledge management would be recognising and thanking staff who maintain good content on a company intranet. Putting a feature in an in-house magazine could do this. To begin looking at reward management from a knowledge management perspective means asking the question ‘do we recognise and reward people for sharing their knowledge, for acquiring new knowledge and for sharing information?’ Too often, in organisations, what is actually rewarded is hoarding knowledge and information. Where this occurs it is less likely to be a problem with the individuals as such, and far more likely to be an issue with the reward system and the culture that it reinforces.

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If the organisational preference is for an individual, performance related pay approach, the pay element of the reward system will need to be designed with care if the intention is to simultaneously encourage the sharing of information and expertise – the two do not sit happily together. If a ‘performance pay’ approach is the ‘culturally’ preferred medium for financial reward, then to reinforce good knowledge management practices it will need to include input as well as output measures (i.e. reward for how people/teams do things as well as what they do). This will mean assessment of achievements against knowledge management objectives such as: •

The extent to which the individual/team has acquired new skills and knowledge

•

Whether or not the individual/team has undertaken new projects or taken on board new responsibilities

•

The development activities undertaken by the team/team members (either inside or outside work, training based or activity based)

•

The contribution of individuals to team working/commitment of the team to its own team development

•

The contribution of individuals /of the team to the development of another employee (e.g. mentoring or coaching)/induction of new team members

•

The generation of new ideas and improvements (in their own areas of work and more widely) by the team/individuals.

These can be combined with generally defined ‘areas of competence’ in good knowledge management, for the purpose of assessing performance of either individuals or teams (or both). The requirements of retaining knowledge workers within their field of expertise may also present a challenge to traditional ‘pay hierarchies’ and it may be necessary to develop different routes for pay progression that do not require people to leave their area of expertise and move into ‘management’. This approach is increasingly common in newer organisations but can be difficult for older, more established, organisations where the way to climb the career ladder is to move from technical specialisms into management. Similarly, traditional incremental pay systems, that reward ‘length of service’ rather than contribution to the organisation or particular expertise and skills, may prove counter productive in retaining and motivating knowledge workers.

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Within one of the organisations that we looked at, although fairly traditional, positive steps had been taken to motivate and retain knowledge workers through a reward strategy incorporating: •

Developing ‘recognition’ systems to publicise achievements

•

Establishing two promotion routes – one technical for those who wished to stay in their area of technical expertise, the other a route for technical people wishing to enter management

•

Merit pay (based on judgements about performance, potential and value to the business)

•

Support for attending and presenting at conferences and taking further qualifications

•

Flexible working

•

Secondments externally.

In another, less traditional, organisation the pay system was determined on an individual basis so that anyone could increase their pay dependent on the contribution they made. This pay system also encouraged the sharing of ideas through merit awards that involved judgement on an individual’s ability to work with others. A profit sharing scheme was operating whereby 25-30% of all pre-tax profits were distributed to staff. This particular organisation had also developed a form of ownership that gave all the employees a stake in the company through a share owning Employee Benefit Trust (EBT). The EBT provided additional profit sharing to staff with more than three years service. In developing a reward strategy that supports effective knowledge management, it is important that it is both acceptable and relevant to knowledge workers. Achieving maximum acceptability in a knowledge environment means developing the strategy in consultation with those it is intended to reward. This view is reflected in ACAS guidance on developing pay systems (1). It also means weighing up the expectations of knowledge workers and recognising the different ‘time horizons’ of different forms of reward. For example praise for a job well done, bonuses and similar have a short time horizon. Pensions, promotions and development that opens up future career opportunities all have a longer time horizon. It is likely that within a knowledge environment a mixture of the shortterm and long-term rewards will be necessary. This will give immediate impact and deliver immediate satisfaction to knowledge workers, whilst also seeking to build longer-term commitment to the organisation.

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A very good pension scheme still remains an effective ‘locking in’ device despite the perceived job mobility of knowledge workers but by itself it will not guarantee commitment in a very flexible and changing market. Neither will it promote innovation and creativity and the short-term ‘burst of energy’ needed to produce new ideas and new ways of doing things. There is an increasing recognition that if the central element (and, after the paybill, often the most expensive element) of a reward strategy is saying to employees ‘wait until you retire and you will be looked after’ then some people will do precisely that! Designing the non-pay elements of the reward system has involved organisations in reviewing how people are managed on a day-to-day basis as well as developing formal and informal schemes for recognising people’s ideas and contribution. Examples of non-pay elements of the reward system in organisations that support knowledge management include: •

Annual awards of various sorts often supported by trophies, cash payments and internal publicity. Examples include an annual training award for the person who had done most to apply their learning within the workplace, an award for the best technical paper of the year published externally, awards for innovation and introducing new ideas to the company

•

Regular features in in-house magazines on the work of particular individuals or teams

•

‘Lifestyle’ rewards for performance, designed to appeal to knowledge workers – such as the opportunity to fly a light aircraft, balloon trips etc.

•

Internal recognition for external achievements, including cash rewards for articles published, support (e.g. time off) for involvement in social projects and recognition in the workplace of the development benefit of such activities

•

Ensuring internal reports at all levels are always in the name of the main author rather than director or senior manager and that they acknowledge other contributors

•

Giving recognition through involving as many staff as possible in project presentations and policy meetings and identifying and publishing the names of ‘lead officers’ in different areas of work. A practical example of this approach, from one organisation, was a ‘policy forum’. With scheduled meetings over the year it allowed a large number of staff to come together over a lunch-time to hear presentations on policy issues from outside speakers as well as from the CEO and directors.

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Recruitment, retention and succession planning in a knowledge environment When recruitment, retention and succession planning are viewed from a knowledge management perspective, the approach becomes less about ‘filling jobs’ and more about filling knowledge gaps – either current or anticipated. Looked at this way, it is immediately apparent that knowledge gaps do not have to be met through filling ‘job slots’ with people. Whilst recruitment may be a solution, other solutions will include implementing new systems and processes, purchasing new technology and contracting in specialist skills (or contracting out a function). In a knowledge environment, recruitment, retention and succession planning are not simply personnel issues but strategic issues incorporating decisions on the shape and form of the future organisation and the use of technology. For example, succession planning traditionally deals with known events such as future retirements of individuals and seeks to ensure a replacement is ‘trained up’ to be ready. In a knowledge environment, succession planning needs to incorporate the retirement not just of people but of technology and applications running on the technology. Similarly retention has traditionally been viewed as keeping people within the organisation and reducing staff turnover. In a knowledge environment what one is seeking to retain is the knowledge – this can mean effectively capturing the knowledge of people who are leaving as well as maintaining databases and archives. However, the separation that exists in many organisations between personnel departments and IT departments does not lend itself to this more holistic approach of focusing on the knowledge rather than the resource.

Recruitment Indicative of organisations involved in knowledge management is an increasingly flexible approach to recruitment. As one of the directors we spoke to commented ‘it is more important to recruit good people you come across than to wait for vacancies to arise’. This person’s experience was that jobs quickly grew up around talented people and that their contribution to the organisation justified their appointment within the first year. There are challenges, in this way of thinking, to the traditional approaches to recruitment favoured (for many good reasons) by personnel departments. Traditional systems tend to be based around the idea of a job and a ‘job slot’ to be filled. They are not focused on the contribution that individuals may make. A difficulty for personnel specialists involved in knowledge management will be

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to balance a more flexible approach with the statutory framework that traditional systems have been developed to deal with. The idea of a ‘job slot’ is, after all, not something invented by personnel specialists but rather something deeply embedded in the thinking of many employees, trades unions and also in employment legislation. The idea of a detailed job description, of a rigidly defined ‘job slot’ to which a person is recruited, does not lend itself to effective knowledge management – or to the development of that individual. A more flexible approach to recruitment does not necessarily mean a less rigorous approach. There is however a particular danger for effective knowledge management in the use of sophisticated selection procedures – for example personality and aptitude testing. The danger is that the ‘norms’ used (particularly if internally generated) may be designed to obtain cultural fit. In doing this they can easily exclude more creative and innovative individuals and discourage diversity – to the detriment of effective knowledge management which seeks to encourage precisely these factors. More important than cultural fit is the ability of candidates to be effective in different cultures, especially as the current culture may be destined (or overdue) for change. As one senior manager of a large American multi-national in the technology sector commented: ‘Our organisation was founded by cowboys, now we only appoint people in suits and complain about the lack of entrepreneurial spirit.’

Retention In looking at the retention of knowledge, it was apparent that many organisations are adjusting their approach to retention to take into account the needs and aspirations of knowledge workers. In part this involves changes to the reward system discussed above. However it also involves taking account of the higher expectations and higher perceptions of self and economic worth of knowledge workers. In this context, a retention strategy cannot just be financially based. It needs to incorporate how people are managed, how they are treated on a dayto-day basis and how they are involved in their work and the organisation. This is implicitly recognised in some organisations where efforts are being made to develop different forms of ‘partnership’ with employees, for example by calling them ‘associates’. Some general principles being applied in the retention of knowledge workers are: •

Making explicit the terms of the psychological contract (the unwritten agreement between the organisation and employees which forms the basis of the relationship) through investigating the mutual expectations of employer and employees – determining those terms that are reason-

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able and deliverable on both sides and producing a written summary. In one organisation, this was described as articulating ‘our own psychological contract by formally and informally involving all staff in jointly developing our whole range of human resources policies and practices’. •

Building trust and evaluating management decisions and communications in terms of their impact on that trust. This is seen as particularly important in times of change. Building trust also means not trying to manage by platitudes and ‘sound-bites’.

•

Involving people in managing their own work and priorities and in the organisation’s priorities. This also involves open communications and allowing access to information about the organisation and the issues it faces. It was noticeable in the organisations we spoke to that a key use of the intranet was to allow access to company information for all staff whether directly relevant to their job or not.

•

Designing corporate personnel policies around the lifestyle choices and personal aspirations of knowledge workers – this can involve flexible working practices such as part-time and homeworking, allowing sabbaticals, allowing time off for community based work and similar. It was noticeable that in all the organisations that we spoke to, flexible and employee centred personnel policies were in place. For the future, such policies need to be flexible enough to respond to different lifestyle choices at different stages in an individual knowledge worker’s career. It would be a mistake to assume such choices will reflect the traditional ‘upward pathway’ of career progression.

It is also noticeable that in knowledge environments the personnel role tends to avoid a reliance on regulating the employment relationship through purely contractual means. This reflects the recognition that there is little to be gained in being legally in the right on an issue, if it results in a key knowledge worker leaving. As one CEO commented, ‘If you have to take out the contract of employment to look at it, you’ve already lost’.

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Succession planning Succession planning as a discipline has tended to be the preserve of large organisations. In the context of knowledge management, it needs to be a concern for all organisations. However, as noted above, it needs to incorporate planning for anticipated and future knowledge requirements, not simply to replace particular people or fill particular jobs. This means planning for the retirement of people and technology and identifying replacements where needed. For larger organisations it needs to be a joint exercise between the personnel and IT departments and to be linked into the organisation’s strategic objectives. In one of our case studies, it was noticeable how one CEO had planned for the eventual replacement of each office automation system at the time of its implementation, and linked this to the organisation’s ‘workforce’ planning.

Impact of knowledge management on the role of managers Power in organisations has been described as flowing from the ability to solve the critical contingencies facing the organisation (2). The importance of knowledge in a knowledge-based economy is putting this power into the hands of knowledge workers, challenging the traditional power relationships within organisations. In practice, it means that knowledge workers will increasingly be determining the way in which they are managed. This presents a fundamental shift in the role of the manager. This paradigm shift is from ‘controllers’ to coordinators and facilitators and ultimately to ‘team servants’.

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Directive

Industrial Economy

Supportive

People management policies and practices

Controlling

Knowledge Economy

Facilitating

Figure 3.2: New management paradigm The changing power relationships will also impact upon corporate employment policies, moving them further in the direction of flexible, employee centred approaches based on consensual models of managing. Management in a knowledge environment, corporately through the organisation’s employment policies and at the level of the individual and team, is increasingly being judged by its ability to encourage and enable individuals to apply their knowledge for the benefit of the organisation. Traditional ‘industrial economy’ models of management, where the manager controls and directs the work of others, are based on the idea of the manager having more knowledge than those managed and those managed being unable to direct themselves. Neither of these factors applies in the knowledge economy. Knowledge workers will often know more than their manager about their own work and are capable of self-direction. The industrial model of management was also based on hierarchical communications with the manager relaying messages from above to the team and taking messages back. E-mail has effectively removed this requirement and with it traditional hierarchical communication structures. Whilst some organisations have tried to retain hierarchical communications despite the advent of technology, this was not the case in the organisations we looked at. In each of them, the opportunity had been taken to achieve direct one-to-one and one-to-many communication through e-mail (and ‘many-to-one’ as a CEO found through asking staff to contribute their ideas directly by e-mail on the organisation’s future strategy).

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If the traditional role of the manager is to continue to reduce in importance within the knowledge environment, it raises questions about the need for managers in the future. The reduction in large numbers of ‘middle management’ posts that has occurred in recent years suggests that this is a ‘live’ issue and not just in those organisations committed to knowledge management. In one of the organisations that we looked at, this thought process had been taken further. The traditional management role was seen as a series of tasks that could be allocated within a team (co-ordinating, chairing meetings, chasing output etc.). The redefined role of managers was orientated around the idea of the manager as trainer and coach. It was seen to involve: •

Supporting team members in their own development and in sharing their expertise

•

Encouraging individuals to use their knowledge and expertise to best advantage

•

Facilitating innovation and creativity and encouraging new ideas

•

Representing the interests of the team/individuals to the organisation.

To be able to deliver in this type of role managers will need to: •

Be able to create what was described by one manager as a ‘high trust’ environment

•

Communicate effectively and ensure good communications within the team as well as between the team and the organisation (one manager described their role as ‘team ambassador’)

•

Prioritise the training and development needs of the team and have the skills to analyse training needs (in one knowledge based organisation, a new in-house training function was established with the first priority being to deliver training on the managers role in training and development)

•

Understand the information and knowledge requirements of their team and the skills of facilitating creative thinking, innovation and problem solving.

In this particular organisation, what was involved in the idea of the manager as trainer and coach had been developed by a team of managers as part of a management development project.

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For managers to encourage individuals to use their own knowledge and expertise effectively for the organisation involves creating an environment in which individuals feel ownership of issues and responsibility for developing solutions. Such an environment is most likely to be achieved where individuals feel a high degree of autonomy and pride. It is interesting to note that two of the organisations that we looked at measured both feelings of pride in the organisation and autonomy at work as part of annual staff attitude surveys.

Training and development in a knowledge environment When discussing knowledge management, training and development is usually identified as having a key role. It is seen as the means by which individuals develop new knowledge and understanding, as well as a vehicle for fostering innovation and creativity. The training methodology – of workshops, action centred learning and similar, is also seen as a way of developing and implementing knowledge management projects, by engendering commitment and a shared understanding. In addition to the usual skills based training and development activities, in a knowledge environment the training function is likely to be involved in: •

Equipping managers to foster innovation and creativity

•

Enabling staff to manage their own learning and development

•

Training in the skills of using information effectively

•

Training in the techniques for generating new ideas and new ways of doing things.

One of the organisations that we looked at identified, as a particular issue for knowledge management, the need to avoid skills and knowledge becoming outof-date. The solutions adopted, managed by the training function, involved: •

A corporate written commitment to formal Continuous Professional Development

•

Emphasising the need for re-training

•

Encouraging individuals to proactively manage their own development needs

•

Establishing an in-house learning resources centre/technical library

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•

Wide publicity for training opportunities

•

Establishing ‘peer’ reviews.

Another organisation decided that fostering innovation and creativity required extensive training in skills such as mind-mapping (3) and neuro-linguistic programming. The approach adopted was to cascade the learning through the organisation by training up ‘champions’ who were qualified to take the training into their departments. Not only did this increase the skills within the organisation, but it also gave a common understanding of what behaviours encourage and discourage creativity and a common language for talking about the subject. Another approach is to encourage issues to be looked at from different perspectives or from a different context. For example, when encouraging knowledge creation, Gestalt Theory suggests that how a problem is represented to people will affect their ability to generate new ideas and creative solutions. For knowledge management, this would suggest the need to invest in the tools and techniques of ‘problem representation’. Examples might include story boarding techniques as well as mind-mapping. In one organisation, the example was given of an undergraduate work-experience student who was given a difficult project to handle. Support was given, together with training in storyboarding techniques and the IT facilities that were necessary in order to create storyboards. The undergraduate was able to produce an innovative solution to the problem despite their lack of experience.

Team working in a knowledge environment Asked about team working in a knowledge environment, a manager from one of the organisations we spoke to told a story about a coffee machine. It had been decided that staff were spending too much time by the coffee machine, so it was withdrawn. It was soon apparent that the flow of information and ideas between the different sections using the machine had dramatically reduced leading to misunderstandings and bad feeling. The coffee machine was put back. This story illustrated a simple point about the effects of physical environment on team working and the sharing of ideas, information and knowledge. In that organisation, it had been realised that making offices more open, allowing people to circulate and meet each other and removing physical barriers to communication had an important part to play in effective knowledge management. Office accommodation was not a simple ‘hygiene’ factor but could have a direct and practical impact on effective service delivery. Organisations that wish to promote

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knowledge sharing and innovation and effective team working across departmental boundaries are increasingly redesigning their work areas to facilitate this process. Another feature in organisations employing knowledge workers and who are committed to knowledge management is the redefinition of the idea of a team. Teams are no longer seen as a group of people working together on a permanent basis within one department or functional area. Teams could be permanent groupings based around an ongoing task or project, temporary groupings put together to deliver a short-term result, physically located together or geographically dispersed. Some teams met only in cyberspace, some teams involved people both inside and outside the organisation – customers, suppliers, consultants, associates from other organisations. The common feature was pooling resources and knowledge to address a common agenda. One organisation employed project managers in its Research and Development area who managed large teams, none of whose members worked for the same organisation, but all of whom had a common interest in the area of research being undertaken. The creation of ‘virtual teams’ using the Internet as the primary means of collaborative working, introduces particular requirements compared with teams that are physically located. In one of the organisations that we spoke to these were summarised as follows: •

Providing a common information database

•

Providing a virtual space for work in progress

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Establishing technical and behavioural communications protocols

•

Establishing progress tracking and ensuring the work ‘stayed on topic’.

The importance of behavioural as well as technical protocols was stressed. This was seen as particularly important with virtual teams whose members lived in different countries. It was felt that electronic communications could easily create cross-cultural misunderstandings. Another organisation stressed the importance of some ‘face-to-face’ contact backed up by video conferencing to supplement e-mail communication. Progress tracking was seen as important because it was felt that virtual teams could become divorced from the organisation and lose sight of the organisation’s objectives.

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Traditional team building stresses that, for teams to function well, there must be a: •

Mutual understanding of each others strengths and limitations

•

Clear objectives supported and understood by the team members

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An understanding of what is expected from each team member

•

Targets for the members of the team and the team as a whole

•

Good formal and informal communications

•

An understanding and respect for the different roles within a team and to have allocated those roles.

Ensuring these things happen would usually be seen as the manager’s role. In a knowledge-based environment, increasingly these things are seen as something that team members can deal with themselves. This can present a difficult adjustment for some managers, for example, if they are used to chairing all team meetings because of their ‘position’. (It was noticeable in knowledge-based organisations that the most senior person present rarely chaired meetings and in one, even the corporate management team was not chaired by the Chief Executive but had a rotating chairmanship.) When supporting knowledge management at the level of teams and individuals, there is a wealth of research from other disciplines that can be brought into play. Information Theory suggests that generating and transmitting knowledge between individuals can increase the feeling of a mutual dependency but that such collaboration needs to be supported by mutual awareness. For knowledge management, achieving the feeling of interdependency (which in turn drives future collaboration) means encouraging the sharing of knowledge. Building mutual awareness between participants in a collaborative venture means utilising technology to provide rapid feedback. In managing teams of knowledge workers, the approaches being adopted are designed to: •

Allow individuals to apply their own expertise and knowledge with minimum interference and maximum autonomy

•

Provide the team with the means to access and share information electronically. A common first step for project teams being established was the creation of a new electronic distribution list. In one organisation the practice was that all communications between team members was electronically copied to the whole team distribution list. Each team member then had the choice whether to read it or not

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•

Reward openness and sharing of information and knowledge

•

Promote networking

•

Provide development opportunities

•

Emphasise feedback from team members to each other and from the organisation to the team (particularly for corporate projects). One example of this was the practice of corporate teams publishing regular progress reports and minutes on the company intranet and inviting comments back from the rest of the organisation.

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Chapter 4 Knowledge management – the organisational dimension Introduction The cultural challenge of effective knowledge management New organisational forms in the knowledge economy Identifying knowledge resources – knowledge audits Transferring knowledge – A ‘merger’ case study

Chapter 4 Knowledge management – the organisational dimension

Introduction In this chapter, we will look at the impact of knowledge management upon organisational culture and ‘ways of doing things’. We will also consider the new organisational forms that are emerging in response to the development of the knowledge economy, the essential aspects of knowledge audits and knowledge transfer in a merger situation.

The cultural challenge of effective knowledge management Brian Arthur (1) suggests that the world of knowledge based business involves continuously redefining an organisation’s ‘way of doing things’, that is, its culture, including a continuous redefinition of organisational aims and objectives. This need for change is being seen in organisations affected by knowledge management and the knowledge economy. Even in those areas traditionally slow to change, such as the Civil Service, cultural shifts have been, and continue, to take place. An example is in the ‘Modernising Government’ proposals (2). These proposals are part of a series of Government initiatives in response to new technology and the impact on how Government ‘does business’ in the knowledge economy. The paper speaks of the need to introduce peer review of central Government Departments and to run joint training for Ministers and civil servants. Those familiar with Central Government will understand the culture change involved in having different departments conduct peer reviews. They will also recognise the cultural change implicit in joint training for Ministers, who are politicians, and paid civil servants.

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Organisational structures These changes in the approach of Government reflect one of the cultural imperatives arising from the importance of knowledge management. For Government it is expressed in the sound bite, ‘joined-up’ Government. This is the idea that the delivery of Government services and policies should be seamless. It should not appear as if many different bodies and agencies, that do not communicate with each other, are involved. For the consumer or citizen it should be like dealing with one organisation. For organisations, it is about integrated and collaborative working, pooling knowledge and information within the organisation. It is about the ‘joined-up business’. It is not about organisations being divided into discrete departments and separate ‘empires’. It is a telling aspect of this influence of new technology that in one organisation, following the introduction of improved electronic communications to its ‘outstations’, a manager working in an office remote from the corporate headquarters commented that: ‘We used to feel like a separate organisation, not part of the mainstream. Now we are in the loop.’ Achieving this ‘joined-up’ working is not just about technology, although the technology is a facilitator. It requires doing things differently and removing blocks to ‘joined-up’ working. A common block is the hierarchical and departmental structure of traditional organisations – divided around functions, specialisms and tasks. These divisions tend to become enshrined in the language and culture of the organisation. It is interesting that in one organisation, a reorganisation led to the abolition of the description ‘Divisions’ for the separate collections of functions reporting to a Director. It was felt to embody the wrong values. It was replaced with the phrase ‘Group’, each Director heading a ‘Group’ rather than a ‘Division’ of the organisation. A simple change, but language is an important communicator of culture. Margaret Ryan (3) stated in her study on linking organisational knowledge to decision making: ‘Organisational structures draw boundaries around the activities of individuals and groups and help to specify and develop relationships between them. It can also be suggested that they regulate what expertise is available, in which arenas, and with how much influence on decision outcomes.’

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Knowledge management requires reducing or removing boundaries and opening up the possibility of new and different relationships between different professions and different specialisms. It requires multi-disciplinary working, collaboration, sharing of ideas and experiences. It requires disparate viewpoints to be brought to bear on problems and issues. The technology facilitates this, as we have seen in Chapter 2. The structure of the organisation needs to reflect a similar approach. This means a loosening of hierarchies, a relaxation of areas of demarcation and a lessening of centralised and controlling management. The flexibility needed by effective use of an organisation’s knowledge resources requires flexibility for structures as well as people. As a CEO we spoke to for this Report said: ‘It’s no longer acceptable, or effective, to have people working in the old traditional watertight compartments. We have to recognise, and facilitate the flow of information within the organisation, the sharing of knowledge and experiences.’ That particular organisation had been through a process of reducing the numbers of management layers, increasing the use of multi-disciplinary project groups to deliver the corporate agenda and redefining the management role into one encompassing the roles of trainer and coach. The organisation’s structure had been redesigned around principles such as flexibility and devolving decision taking to the lowest possible level. Typically, knowledge environments will flourish in flatter, less hierarchical and less bureaucratic structures. Although, there is an important caveat that flatter structures do not necessarily mean less well-resourced structures. There is some evidence emerging that the de-layering exercises of the 90’s have reduced resources to the extent that information and work overload are occurring. Also, that ‘initiative’ exhaustion and reduced career opportunities are adversely affecting motivation. This does not facilitate knowledge management. Knowledge management also tends to flourish where the expertise and experience, the know-how, in one part of the business is accessible to other parts of the business. Where there is regular interaction, whether in physical or virtual reality, between different areas of specialism and different types of expertise and where decision making is open to influence from outside a small core of ‘senior managers’ and policy specialists.

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Culture In earlier chapters, we have looked at the technology and people issues in knowledge management. This reflects the view that it is the interaction between these two dimensions that results in an effective knowledge based organisation. However, the context in which these two aspects interact is the organisational culture. Without a culture that is conducive to knowledge management, the potential to effectively harness the organisation’s knowledge resources will be lost. It is the ‘cultural environment’ of the organisation that will determine whether the investment in technology and information will be matched by an equal investment from individual knowledge workers, in using it to greatest effect for the benefit of the organisation. Similarly, it is the cultural differences between organisations that make the transposition of solutions from one organisation to another so difficult. One manager we spoke to saw the distinct culture as producing the real competitive advantage. Their reasoning was that it couldn’t be duplicated. They did not see the competitive advantage lying in better processes and procedure as, because of benchmarking, these tend to be replicated elsewhere. One of the most prominent ‘cultural’ features that is apparent in organisations that are ‘good at’ knowledge management is the willingness of people to share information. This is often inhibited in organisations that foster an excessively competitive internal environment or that are particularly ‘political’ in internal relationships. If, in an organisation, people were not keen to share information, this would suggest a cultural issue rather than a problem with the individuals. For example, organisations where ‘presentation’ and self marketing are more likely to bring rewards than collaborative working and sharing, it is unlikely that effective knowledge management will take root. Similarly, if control of resources and empire building are seen as the sources of power and influence, then the necessary multi-disciplinary approaches and cross boundary sharing of ideas and knowledge will be inhibited. Whilst a common starting point for knowledge management is a knowledge audit, a better starting point is likely to be an analysis of the current culture, identifying those aspects which will promote knowledge management and those aspects that will hinder it. This will also show the level of change and the commitment necessary from senior management, if knowledge management is to become part of the fabric of the organisation rather than just ‘one more initiative’.

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In considering the question of what type of culture is most conducive to effective knowledge management, a good starting point is to ask what makes individuals good at acquiring, using and sharing information and knowledge? Typical answers to this question that we have come across in a range of organisations include: •

Is a good listener and equally willing to contribute to discussions and share ideas

•

Is able to build constructive relationships with others

•

Is not always seeking the credit and never tries to take it from others

•

Knows how to find out information and knowledge from a range of sources

•

Is able to separate out relevant from irrelevant information

•

Can make connections between different, apparently unrelated, information

•

Is able to organise information and ideas into a logical format

•

Can produce new and creative ideas and look at things from different perspectives

•

Is committed to continuous learning and personal development and always looks for learning opportunities in new experiences.

From these answers, we can begin to describe the type of culture in which these attributes will be nurtured and supported. Such a culture is likely to be one that values (and demonstrates in tangible forms that it values): •

Individuals and individual viewpoints – this includes listening to dissident views (i.e. contrary to current thinking within the organisation)

•

Collaborative working and sharing of ideas and information

•

Building relationships – internally and externally (networking)

•

Trust

•

Sound underlying systems and procedures

•

Creativity and innovation

•

Training and development.

Whilst many ‘mission statements’ will refer to these things as being valued, whether or not they are actually valued, will often be a question of what behaviour the reward strategy reinforces and what behaviour is penalised (whether overtly or covertly).

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The difficulty of living some of these values in an organisational context should not be under-estimated. For example, in organisations, whether something is taken to be true or not often depends upon how consistent it is with other things that are accepted as being true. This is a ‘coherence’ test (does the statement fit in with the other statements we believe). Dissident voices in an organisation are, by definition, often expressing views that do not fit in with current thinking and what is generally accepted in the organisation to be true. This makes it difficult for them to be heard, to be valued and to be acted upon. Similarly, the autocratic CEO that surrounds themselves with ‘yes’ people is unlikely to accept a negative criticism as true on the perfectly reasonable grounds that it does not fit in with what most of the people around them are saying. To see beyond this is a challenge for every senior manager in an organisation. Finding out whether a culture will be conducive to effective knowledge management means looking for the evidence. This will be found in the effects of the culture. One way of doing this is to look at the effects on the people who work in the organisation. One of the organisations we looked at regularly surveyed its staff to ascertain whether they felt that: •

As individuals they had a high level of autonomy in their work

•

Whether team working and collaboration was encouraged by the ‘way the organisation did things’

•

Whether they felt the organisation was committed to their training and development

•

Whether they felt able to fully use their skills and abilities

•

Whether they felt valued

•

Whether they felt there was sufficient variety in their work

•

Whether they felt adequately informed about and involved in decisions that were made.

The answers from staff to questions such as these give a good indication of the type of culture in existence. It will also be a good indicator of how likely it is that knowledge management can be successfully introduced.

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1.

Is there a low level of ‘office politics’ and an avoidance of ‘hidden agendas’?

2.

Do they encourage a shared stake in the outcomes/ownership of issues?

3.

What emphasis is there on sharing ideas and what are the rewards for doing so?

4.

What efforts are they taking to make work stimulating and meaningful for all staff?

5.

Is there a strong sense of the need for minimal but effective bureaucracy?

6.

Does co-operation between staff bring more rewards than competition?

Figure 4.1: Questions for senior managers

The Government White Paper ‘Our competitive Future – Building the Knowledge Driven Economy’ (4) speaks of an economy in which the generation and exploitation of knowledge plays the predominant role in the creation of wealth. It identifies the need to use and exploit all types of knowledge in all areas of economic activity and describes knowledge, skills and creativity as the distinctive assets for achieving a competitive edge within a global marketplace. Without a culture conducive to effective knowledge management, this particular competitive edge is unlikely to be achieved. Making practical changes will focus on those organisational systems and processes, the ways of doing things, which transmit the organisational culture to new employees and reinforce the organisational culture with existing employees.

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New organisational forms in the knowledge economy In earlier chapters of this Report we have considered new ways of working in the knowledge economy and have identified some of the approaches associated with effective management of knowledge and of knowledge workers. In addition to new ways of working, there are also new organisational forms developing. The use of information and communications technology reduces the impact of geographical location and physical presence on the shape and form of organisations. It reduces the value of traditional organisations as structures that integrate and co-ordinate various resources and activities to deliver a service or product. It also offers the potential to reach customers directly rather than through traditional distribution means. These changes take away some of the fundamental reasons which have created many organisations in their current forms. These are the need to: •

Provide a physical location and base for work to take place

•

Co-ordinate and integrate activities

•

Provide direction to activities

•

Distribute products and services

•

Promote and market products and services

•

Provide the capital to develop new products and services.

Meeting these needs through a traditional organisation has required an infrastructure of ‘support’ services, ranging from people who manage premises through to people who market products and services. Where the use of ICT removes these needs (for example, the need for a geographic ‘base’) or meets them through different means (for example, co-ordinating activities over the Internet) the infrastructure of a traditional organisation can become a hindrance to competitive success. This is leading to changes in structures. Structures are changing to accommodate virtual teams and flexible working practices such as home working, as well as the increase in the number of ‘employees’ seen as periphery workers. Periphery workers used to include those on short-term contracts and consultants. Increasingly it is including those knowledge workers who are perceived as mobile and, although on permanent contracts, are not expected to stay very long with the organisation. These workers are also finding that there is less interest in investing time and money in their development and are having to take an increasing level of personal responsibility for their own development.

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The development of ICT is also seeing the creation of new, knowledge based, products and services. These products and services can be developed and distributed through the use of the Internet by ‘organisations’, that may comprise a few core people and a network of associates. The development of many of these products and services is dependent upon the ability to bring together the knowledge and skills of different individuals in collaborative working. In the area of traditional products, ICT allows the ‘one person in their front room’ type of business to have a worldwide presence and worldwide sales – something that until recently would have required the infrastructure of a typical large organisation. One example is the violinmaker who operates his business over the Internet, with secure credit card transactions on his site provided by a specialist provider. The business operates from his home but has worldwide sales. ICT is also leading to increasing numbers of ‘communities of interest’. Groups of individuals sharing their knowledge and collaborating on ventures without any formal organisational structure specifying their relationship to one another. Some of these communities will be acting as pressure groups in social policy matters, others will be developing products for non-commercial distribution (particularly in software development), some are simply individuals with a shared hobby, occupation or interest. These are the ‘unorganised’ organisations based upon people’s free association, mediated through the Internet. The existence of these communities of interest may seem peripheral, however the ‘business model’ they embody can affect traditional organisations. A striking example of this is a major corporation such as Microsoft™ identifying Linux, the free operating system, as a potential business threat. However, it is notable that the development of new types of organisation and business opportunity is not leading to the demise of old-established businesses in quite the way that was being predicted a few years ago. An example of this, is the role of the ‘middleman’. It was widely predicted that the direct access potential of the Web would lead to the demise of these ‘brokering’ services. Instead, Web based brokering services have developed, such as electronic clearinghouses, transaction brokers, and virtual trading communities. There is also a considerable amount of business-to-business (B2B) commerce conducted over the Web, in addition to business-to-consumer. According to a recent OECD published report (5), the B2B sector on the Web has been more successful than the business-to-consumer. It has also been dominated by ‘old’ businesses utilising ICT as part of their natural evolution, part of a continuing process of improving the use of information, reducing production costs and streamlining the supply chain.

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Web sectors led by ‘old’ established businesses

Brokering services

Web sectors led by newer dot.coms

Businessto-Business

Businessto-Consumer

Figure 4.2: Business leadership on the Web Just as traditional forms of organisation were developed as an effective response to perceived needs, so new forms will need to be adapted to the needs of the knowledge economy. Dependent on the particular sector, this will mean adopting organisational forms that can: •

Obtain and analyse market intelligence

•

Change in response to market changes

•

Exploit new technology and resolve technological issues

•

Speedily develop and bring new products and services to the market

•

Retain or acquire essential knowledge and skills

•

Manage their knowledge base effectively

•

Interact effectively with a global (and often invisible) customer base

•

Continuously learn and apply that learning, creating new knowledge.

The indications so far appear to be that many ‘old’ businesses are successfully making these changes.

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Identifying knowledge resources – knowledge audits There is no ‘one-way’ to conduct a knowledge audit. In this section, we outline one possible approach. The model adopted needs to be tailored to the culture, size and level of complexity of the organisation involved. Whatever the model adopted the overall purpose of a knowledge audit remains the same. It is to identify the current knowledge assets within an organisation. This can make those knowledge assets accessible and useable as well as help to identify potential or actual knowledge gaps. A knowledge audit answers the questions, ‘what does the organisation know?’, ‘what could it know?’ and ‘what should it know?’. The ultimate aim is to leverage maximum added value from the knowledge resources. Preliminary steps to conducting a knowledge audit often involve establishing ‘knowledge management’ as a corporate initiative. Typically this includes: •

Identifying an internal ‘champion’ for the process. For some organisations, this has involved creating a post of ‘Chief Knowledge Officer’. For others, the role has been given to a senior manager. To be effective it is important that the ‘champion’ is at a senior level (e.g. director) and has visible support from the top.

•

Establishing a knowledge management project team. Given the range of sources of knowledge, this will often include IT, personnel and records management staff.

•

Identify any external assistance required. Whilst not always necessary, it can avoid ‘re-inventing the wheel’.

•

Formulating and communicating to the organisation the objectives and anticipated outcomes from the project. This is particularly important given that much of the knowledge base rests in the records, files and minds of individuals.

The first stage of the audit process will often focus on identifying and mapping the structure of an organisation’s knowledge rather than the content. This provides a common frame of reference and helps to scope the task. It is also a resource that can be made accessible within the organisation to enable others to access existing knowledge resources.

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The knowledge of the organisation is likely to be contained within: •

Skills, experience, qualifications of employees

•

Documents held centrally, in departments and by individuals

•

Archives

•

Electronic systems – databases, e-mails, intranet etc.

•

Contacts and networks of which the organisation is part

•

Contacts and networks of which the individual within the organisation is part (both internal and external)

•

Libraries (either central or distributed within the organisation)

•

Relationships with other firms

•

Training materials

•

Patents, publications and research projects

•

Finance and personnel department records.

In addition, there is further knowledge that is accessible to the organisation although not held by it. This includes knowledge accessible through the Web, in public domain sources, through Central and Local Government, in professional institutes and similar bodies. It may also include knowledge held by customers and suppliers. Having mapped the knowledge assets, the next step is to produce an outline of content and to address the questions: •

Is the knowledge we have accessible? How can it be made more accessible?

•

Is the knowledge we have continuously updated? What are the processes for capturing new knowledge and updating existing knowledge? Are they effective?

•

Is the knowledge we have sufficient to meet the present and future needs of the organisation? Where are the ‘knowledge gaps’ and how can we fill them?

•

Are we using the knowledge we have effectively? How can we leverage more value from it?

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STEP 1 Map Knowledge STEP 2

Assets

Produce Contents Outline

Figure 4.3: The knowledge audit process

Producing an outline of content may also involve exploring the ‘tacit’ knowledge of employees. This is the knowledge that individuals have based on experiences, beliefs and values that may not be codified or in the public domain. This can involve using focus groups and job analysis techniques. This is illustrated in the case study in the next section, where it was necessary to audit and capture knowledge in a merger situation.

Transferring knowledge – A ‘merger’ case study Following a merger between two large organisations, it was decided to relocate both former main offices onto the same site. This involved relocating approximately 1,500 staff. Early on it was identified that a considerable number of the staff would opt not to relocate. It was recognised that this would lead to a substantial loss of knowledge and experience. It was also recognised that those relocating would need to adapt to the new systems and processes operating at the new location. External assistance was sought to assist with addressing both the potential loss of knowledge and experience and the anticipated training need. The decision was reached to approach the potential problem from the viewpoint of: •

Ensuring that staff recruited to fill the jobs at the new location could become effective as quickly as possible

•

Ensuring staff relocating received training in the new systems and procedures operated at the new location.

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This meant identifying the content of the jobs of those who would not be relocating and the knowledge and skills required to do those jobs. It also meant identifying the knowledge gap that would exist for those staff transferring. This information was then to be converted into a training and development plan, covering both new recruits and transferring staff. The plan needed to identify both the knowledge and skills required and the methodology for their acquisition. A champion for the project was identified at senior level who was part of the integration team overseeing the whole merger process. To carry out the work on the project a consultant was appointed who had detailed knowledge of the organisation. The stages in the project were: •

Devising and agreeing a process for the project, together with timescales and a budget for delivering identified training

•

Developing a means of capturing information about each individual’s job, the key tasks in it and the knowledge and skills required to perform it effectively

•

Developing a means for identifying the knowledge and skills gaps that would exist for those staff relocating

•

Communicating the data capture process to work group leaders and providing coaching on an individual basis in its use

•

Working with work group leaders/managers in the completion of the data capture process

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Analysing the captured data

•

Developing and implementing a plan for knowledge transfer/acquisition.

The data capture process developed was based on job analysis techniques. It involved individuals identifying the key elements of their jobs and what they saw as the key knowledge, skills and experience to perform the job effectively. This was then followed up with the individuals in one-to-one discussions which were based on the completed data capture forms. The follow-up interviews were an important part of the process as it helped to identify ‘tacit’ knowledge that the individuals did not realise they were applying in doing the tasks. Group leaders/managers were used to carry out the process because of the numbers involved and also because of their own operational knowledge.

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The data capture process provided information on current jobs under the heading of: •

Key tasks performed

•

Necessary skills/qualifications

•

Required knowledge

•

Desired attitude/understanding.

The priority of the tasks to the business area, numbers involved and key relationships were also identified. The process provided information on ‘knowledge gaps’ that would arise for those staff relocating. An uncertainty underpinning the process was the precise numbers of staff who would leave and the number who would relocate. Based upon the information obtained, and estimates of the likely numbers and people relocating, knowledge acquisition and transfer needs were identified. The knowledge acquisition needs were to be met through a detailed training plan for new recruits and relocating staff, together with targeted recruitment for certain specialist roles. For example, in one department, comprising a small number of highly specialist staff, only one person decided not to relocate. Here, the solution lay in ensuring the recruitment of another specialist in the field who would then receive an induction to the company and any specific departmental and company knowledge required. The knowledge transfer needs were met through a documented process based on the data that had been collected and an analysis of processes and working practices in each area. This was then supported through ‘on the job’ mentoring and coaching for those involved in their new place of work. This whole process for transferring knowledge was tested using a pilot group before full implementation.

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Chapter 5 Conclusion Lessons from the growth in knowledge management Political and regulatory perspectives on knowledge management and the knowledge economy Preparing for the future in the knowledge driven economy

Chapter 5 Conclusion

Lessons from the growth in knowledge management Managing knowledge is not new. As discussed in the introduction to this Report, managing and applying knowledge has been a feature of human societies throughout history. What is new is the growth of the knowledge economy, facilitated by information and communications technology. In this economy, the focus for many organisations is on how to leverage maximum value from their existing knowledge base and how to expand that knowledge base. This, in turn, is fuelling the development of active knowledge management techniques. Taking an active approach to knowledge management involves the management of people, information and technology. Any element taken in isolation is unlikely to deliver the required results. For this reason, we have described knowledge management as fundamentally multi-disciplinary. One of the key lessons from studying knowledge management is the need to ensure that it is dealt with on a multi-disciplinary, enterprise wide, basis. Successful knowledge management is not the preserve of the technologists, the personnel or the information specialists working in isolation. A planned approach to knowledge management that identifies what is important and relevant will also avoid the temptation to try to identify and codify all knowledge within an organisation – a task that would likely be impossible. A good starting point is usually in an area where immediate and ‘value added’ benefits can be achieved. This will help to win the business cases for the endeavour.

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People management

Culture and structure

Technology

Information management

Figure 5.1: Elements of knowledge management

The lessons from the technical infrastructure of the knowledge economy, particularly the Internet and the World Wide Web, are about embracing new ways of working. Organisations are achieving improved service delivery, reduced lead in times for new products and improved productivity from the use of virtual teams and the ability to involve large numbers of people (and considerable distributed processing power) in collaborative work. These organisations are also learning that working together and producing results does not require people to be employed by the same organisation. It does not require them to be coordinated and directed through the same hierarchical structure. Collaboration in the knowledge economy can be internal to an organisation but it can also cross the boundaries to involve customers, suppliers, affiliates and consumers. The relevant question is whether or not there is a community of interest that will bring people together to work on the particular issue or project. Energising and enthusing others to work on your agenda will be an important part of creating a community of interest. The knowledge economy also puts a premium on the recruitment and retention of knowledge workers. A lesson for those involved in this area is that the ‘war for talent’ has moved beyond simple remuneration packages. Increasingly it is about the alignment between individual and organisational values, the ability to provide meaningful and interesting work and the ability to accommodate the lifestyle choices of individual knowledge workers. The change in the relative position (and power) of knowledge workers is, in turn, changing and challenging

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the role of managers. Corporate people management policies are being pushed further in the direction of supporting and facilitating staff and away from controlling and regulating behaviour. Another key lesson from looking at knowledge management is the difficulty of making it happen outside of a supportive culture and flexible organisational structure. Innovation, creativity and the application of knowledge by individuals, requires trust and collaboration. If the culture of the organisation does not create trust, if it does not recognise and encourage collaboration, the step from information to knowledge management is unlikely to occur. What is clear from looking at knowledge management within various organisations is that it is not a straightforward subject area. Knowledge itself is poorly defined and comes in different shapes, sizes and different forms. Todd (1) has described knowledge as ‘messy’. Effective knowledge management needs to be flexible enough to cope with this characteristic. It also has to deal with the organisational ‘politics’ of information sharing, breaking down the barriers created by the ‘knowledge is power so I will hoard it’ mentality.

Political and regulatory perspectives on knowledge management and the knowledge economy In this Report, we have looked at knowledge management from the perspective of organisations. Whilst there is much that organisations can do, effective knowledge management does not begin and end at the ‘factory gates’. It is the Government and public authorities that dominate and control the primary knowledge infrastructure of the country. The main components of this infrastructure are the public information services and the education system. If organisations are to maximise the benefits from this knowledge infrastructure – in the interests of their own effective knowledge management – then there is a strong argument for increased public/private sector partnership working. There are other areas in the development of the knowledge economy and knowledge management where action at Governmental level is necessary, whether directly or in partnership with, the business community and interest groups. It has a role to play in the economic regulation of the network infrastructure, ensuring effective competition between providers and promoting universal accessibility. It has a role to play in building customer and user confidence in the security and reliability of the networks. It also has a leading role to play in creating a legal and fiscal framework within which the knowledge economy can operate.

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The UK Government has positioned itself to address these concerns, working to an agenda that is based on: •

Creating an environment in which users and consumers can trust the digital marketplace. This involves dealing with issues of consumer protection, content and standards, personal privacy and data protection.

•

Creating the ground rules for the electronic marketplace. The development of ICT has created issues for Governments generally, in terms of domestic legislation and domestic tax regimes. In the area of taxation, the UK Government is arguing the ‘Country of Origin’ principle. This is that goods or services are taxed where they originate from, not where the consumer is located.

•

Addressing issues of social inclusive/exclusiveness and the ‘digital divide’, between those with access to ICT and those without. There are legitimate grounds for concern that the widening of a ‘digital divide’ between those with access to ICT and those without will prove socially divisive and de-stabilising.

•

Supporting the movement of business (particularly small to medium concerns) into the knowledge economy through financial and technical assistance and advice.

•

Ensuring free and fair competition in the provision of e-services.

•

Supporting the development of the knowledge economy technical infrastructure.

•

Providing leadership through utilising the new technologies in the delivery of public services.

•

Supporting the use of new technologies to deliver any educational opportunities.

Information on how the Government is tackling these issues, in the form of a detailed action plan, targets and regular progress reports, is available through the Government office of the ‘e-envoy’ (2). The targets cover all areas of the eeconomy. They also include the objective of implementing a ‘cross-governmental’ knowledge management system that embeds knowledge management into operational practices – something all organisations should be aiming for. What is clear from the approach of the UK Government, and the governments of other countries, is that achieving a leading position in the knowledge economy is seen as essential to future national prosperity. The urgency and priority governments are giving to this is considerable and the awareness of the issues is high. The message for organisations is that something taken so seriously by governments across the world is not something to ignore.

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Preparing for the future in the knowledge driven economy The advent of the knowledge economy seems unlikely to rewrite the rulebook for organisations to the extent that some may have thought (or wished). The ideals of perfect competition between providers of goods and services, the disappearance of ‘brokers’ and other intermediaries, low to no transactions costs and a global market place for all goods and services are unlikely to be realised in the short-term, if at all. However, the reduced cost of entry to the marketplace, the ability for small organisations to have the same ‘Web presence’ as large organisations, the ability to work collaboratively across national frontiers and the increased speed of transactions, are realities. In the public sector, the technology is also making possible the provision of greater access to information and decision making and an ‘empowerment’ of citizens. For organisations, whether in the public or private sector, the ‘empowering’ aspect is already being felt in areas such as complaints handling – where the ease of sending an e-mail complaint has had a marked impact on volumes handled. The positive response to this is to accept that if individuals are prepared to offer complaints, they share a commitment to improving the services or products being complained about. The issue then becomes one of processing the complaints and treating them as one more ‘source of knowledge’ to be incorporated into the knowledge management strategy and utilised in achieving improvements. An increase in complaints and ‘customer feedback’ is one example of the effect of improvements in the communications infrastructure brought about by new technologies. That communications have improved, that they are faster and more direct, means that there will be less space for the filtering of information that has been a feature of most larger organisations, whether commercial or governmental. Preparing for this means being prepared to engage in a far more active dialogue with consumers, citizens, employees, shareholders and other stakeholders. It will also mean dealing with interest and pressure groups that have used the Internet to organise and co-ordinate their activities – as has been noticeable in the de-mutualisation debates within the financial services sector. In preparing for the future, organisations will need to understand where they currently stand and why. This means understanding the extent to which the organisation is as it is because of factors which will no longer be so relevant – for example geographical factors and the need to provide a centralised base for employees. It will mean assessing the current culture and how supportive it is for knowledge management and how responsive it is to change. It will also mean

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re-assessing the approach to people management and how effective it is likely to be in recruiting, retaining and motivating knowledge workers. Preparing for the future does not mean changes for changes sake. Enough managers and employees are already suffering from ‘initiative induced exhaustion’ brought on by the pace of change and the number of new management initiatives introduced over recent years. Change that is not carefully thought through and based on a consultative approach is, in any event, likely to be contrary to the requirements for effective knowledge management. It does however, mean being aware of the relative strengths and weaknesses that the organisation has in responding to the knowledge economy and incorporating that thinking into the strategic planning process.

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Appendices 1

Case studies

2

Summary checklist: Introduction to knowledge management

3

Summary checklist: Knowledge management – the systems dimension

4

Summary checklist: Knowledge management – the people dimension

5

Summary checklist: Knowledge management – the organisational dimension

6

References

7

Further reading

Appendix 1 Case studies

Ford Motor Company The authors wish to thank Sean Mcllveen, Director of Education, Training and Development for Europe, for the information given in the following case study. The Ford Motor Company employs approximately 380,000 people globally. Its many brands include Volvo, Mazda, Lincoln, Ford, Mercury, Jaguar, Aston Martin and Land Rover. Being asked to define ‘knowledge management’, Sean Mcllveen’s said that he saw it very much from a learning perspective. He stated that: ‘There can be many answers to that question as people define it differently. To me it implies a mechanism by people to access information that is relevant to their business needs. It is the ability to see the ‘wood from the trees’, through the ability to filter relevant information.’ The marketplace and where Ford has positioned itself in that marketplace determined ‘relevance’ in a business context. He stated that there were three main elements to a learning based approach to knowledge management: ‘Well there are three main elements; the first one is the competency framework – defining what you want people to be good at, and how they fair relative to the required competence levels. The second element is learning resources, which are targeted to meet identified learning needs. The third is the feedback loop by which you validate the effectiveness and relevance of the learning intervention.’ The competence model, according to Sean, is the key; it sets the agenda to what you want employees to align their skills to. Sean identified the importance of mapping knowledge requirements, which he saw as being a form of gap analysis. He stated once you had analysed the knowledge gap then you could map learning and knowledge resources. He said that he believed that knowledge management within the organisation and within his own industry was very much increasing in importance. He believes an organisation has knowledge. He said it has it in its systems and in its culture.

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He also saw knowledge management as critical to the future success of his organisation. The main driver behind knowledge management, from his perspective, was to have a sustainable source of competitive advantage through people. He noted that he believed an organisation’s employees were your ‘only source of sustainable competitive advantage’. He added that there was a very specific Ford culture in which people worked. Culture he felt ‘can’t be copied’. Although Ford had businesses throughout the world, and that each country had its own culture, Ford business was always done in the same way. He said this actually provided the framework to which employees reference and act. He stated that in product led strategy it was increasingly important to reduce product cycle times. Knowledge retention and organisation learning, together with effective information exchange between people, was vitally important in the reduction of cycle times. The information technology that Ford utilises to support internal communications comprises of the Internet, intranet, e-mail, electronic bulletins and access to global databases. Web access is typically available at the desktop, however Ford is currently rolling out a ‘Model E’ programme that gives access to the Internet for all employees from their home. This is aimed at encouraging all employees to embrace the e-economy. That is, approximately 380,000 employees globally. An employee can access the business statements of the company, the strategy and its values. They can also access the corporate strategy pyramid, the consumer organisation and what it comprises, and the global brand, as well as the consumer driven 6 sigma – which is used for analysing processes to see where they can be made more effective. All employees can also access HR Online. The aim of HR Online is to provide an easy to use tool that employees and operating management can use to access Ford HR information. This includes information supplied by in-house experts on company policies and procedures as well as online functionality such as the Ford Privilege car purchase scheme. Employees are given a secure password so they can view and update their own personal data which would automatically update the HR information held centrally, for example change of address details if they have moved house Another area that can be accessed through HR Online is the 360° feedback, which is carried out globally. You select six peers and six subordinates and propose these to your manager. Once the submission is agreed, you can input these names into the system and you are rated on-screen by those individuals. The 360° appraisal is divided into twelve leadership dimensions, which focus on the behaviours of how you actually do your particular job. HR Online has received accolades internally as well as external recognition.

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The intranet was seen as being a very effective communication tool, offering flexibility and as a relatively inexpensive way of doing things. It required little in terms of software, and could easily be accessed by a browser anywhere in the world. However, the disadvantage is that you have to make sure that you order the information so that people can access the information they need when they need it. One thing he stated that was very important was that everyone had the same software and hardware, everything was the same version, so there couldn’t be any user confusion. Sean gave some practical examples of virtual communication and virtual relationships within Ford. He said ‘we have a lot of video conferencing, but it has its issues’. Most people in the company are managed by people in different countries so it’s very important for them to spend time physically with their manager and team members before they use video conferencing to reinforce the relationship. According to Sean, Ford profiles skills and knowledge when recruiting and has introduced flexible ways of working to increase retention. These include flexible hours, home working, extended leave of absence and they are always looking for new methods of encouraging a more flexible and open approach. The other methods that they have adopted to retain knowledge workers within the company are giving them stock options, a very good career progression and personal development. Ford recruit on a Pan-European basis and Sean described the recruitment process as a ‘courtship process’. He qualified this by saying: ‘We have a lot of dealings with specific business schools throughout Europe and recently took 46 people from leading business schools across Europe to the United States to meet Bill Ford and Jac Nasser, the Ford Chairman and CEO.’ He stated that this built relationships and could also give them an insight into the calibre of people coming from the particular business school. Ford jointly run BSc and MSc programmes, the MSc programme at Loughborough, that is initiated by Ford, is in Automated Engineering. They’ve put a lot of their own design into the programme, which then gives the programme a very specific tailored output.

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He believes that the reward system at Ford recognised and encouraged the acquisition and sharing of skills and knowledge. He said; ‘it was an element of performance’ that was assessed on a continuous basis. The training and development that he felt was important in a knowledge environment was to ensure that the overall approach was very focused and that the learning programmes were action based around projects that were happening within the company. When asked if knowledge management was having an impact on the culture of the organisation he said that Ford also supported employees in doing what they wanted to do, even though it might mean nothing specifically related to the company and that they had a scheme – The Employee Development and Assistance Programme – which gave money to individuals to do non work-related programmes, such as pottery or sailing, so they developed outside their own specific skill area. This scheme was established and run jointly with the Trade Union. Ford also carries out basic skills training with the families of those people employed at Ford. Family basic skills training occurs often on a Saturday morning or in the evening and tends to focus on basic numeracy and literacy. Ford is building a Learning Centre of Excellence at Dagenham together with the LDA, where there will be a new learning environment. As they feel that the inclusion of learning in the social agenda is very important, they are also ensuring that there is a crèche so that there are childcare facilities for those people who wish to learn but have small children. Sean was asked about the importance and use of intelligent systems within the business. He stated that they had too many to mention. He said ‘every part of a car is controlled and monitored, systems are being developed that provide intelligent crash protection through to advanced navigation systems. If you order a Ford with a specific colour or seat trim, it is all fed into the Ford Product System which controls the car as it is being processed’.

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Inez Limited The authors would like to thank Juliet Butterworth (Managing Director) of Inez Ltd for this case study.

Background Inez Ltd is a consultancy company that specialises in enhancing customer interaction. The company is built on 12 years of operational management and consultancy experience obtained in the call centre industry. Inez has experience in information processes, systems and services within the call centre environment and has a wealth of knowledge around the issues of people, processes and technology in moving from a call centre environment to a multimedia environment.

Inez and knowledge management Juliet Butterworth defined knowledge management as: ‘The sharing of information amongst a known group of individuals that form our organisation.’ Inez has worked with a leading call centre outsourcing company in the area of knowledge management. Although the phrase ‘knowledge management’ was not actively used within the organisation, considerable steps were taken towards what would be described as effective knowledge management. At the time of writing the organisation had: •

Developed an intranet to share information quickly and easily across the organisation

•

Defined the information requirements for all functional areas of the business

•

Reviewed and replaced as necessary core business systems to support the defined information requirements.

Through identifying the information requirements of individuals and functional areas, the organisation was able to use the intranet to deliver that information. Effectively managing knowledge was judged to be important because of the extremely competitive nature of the business environment and the differentiation that could be achieved through retaining knowledgeable and effective staff.

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As knowledge was seen as being ‘within a person’, if a person left then the intellectual capital of the organisation was reduced. The impact of a knowledge economy and knowledge management on the role of the manager was being seen in managers having to be far more open with staff. A manager needed to co-ordinate knowledge rather than have any specific knowledge and their position was no longer dependent on controlling information.

Drivers for knowledge management The recognition that knowledge was ‘within a person’ underpinned one of the key drivers in the development of effective knowledge management. In order to ensure their leading position in call centre outsourcing, the organisation realised the need to tackle three different but interrelated situations. They needed to improve retention, increase performance and continue to match customer expectations by having the information, personal knowledge and technology to respond quickly. This was threatened by high staff turnover amongst telephone agents – a common problem in call centres. The company recognised that high staff turnover resulted in: •

Loss of knowledge

•

Loss of experience

•

High recruitment costs

•

High training costs

•

No easy access to performance or quality information

•

Low morale

•

Poorer business performance

•

Poorer quality of service.

Investigating high staff turnover revealed that telephone agents felt they added no value to the company. They saw themselves as confined to a desk with a computer screen and a telephone, having to follow a company script that they had been trained in. They saw little variation in their job and subsequently became bored and would leave.

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The company realised the solution lay in changing the corporate culture to promote the sharing of knowledge. Fundamental to the sharing of knowledge was making the agents feel in control and able to use their initiative. For this they needed information at hand to serve the customer fully and the technology to enable them to do more. The Company also realised that it was important for the technology to serve the agent rather than the agent having to fight the technology. Inez was given the task of finding a Web-based solution not just for the telephone agents but for all the core business areas so that sharing of knowledge and information could permeate the business. This involved working closely with HR and other core business areas as well as finding an information system that would be accessible to everyone, cheap to roll out, easily maintained and intuitive. It needed to be capable of being used by agents and customers alike where easy access to information could be gained both inside and outside the company and where access to corporate information applications was through a single entry point. A Web solution was developed which was capable of providing communication services, personal services, training, information services, productivity aids, business applications and client information services. The communication services incorporated both formal and informal communications. E-mail was seen as the formal business communication method. An alternative service was developed for general announcements, buying and selling items etc. Staff saw this as an example of less formal, but never the less important, communication. To help employees different types of services were offered online. One service gave employees six categories of personal service. These were: •

A simple search capability provided the ability to easily find anyone in the company. By using simple search criteria you could find out the person’s role, skills, division, department, telephone number, e-mail address and also be provided with a photograph, so that you could recognise them when you met them.

•

Employees could also view their personal information that the company held. This personal information service was two way as it also allowed the employee to amend personal information such as address, home telephone number, bank account details, etc.

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•

An occupational health online service provided information on health in the work environment and the means to access articles on health, employment law, safety and first aid.

•

Holidays and absence reporting online allowed employees to book holidays and notify the company of absence, as well as the ability to view personal holiday and absence records.

•

A diary facility gave everyone the facility to book meetings.

•

A business card renewal facility meant that business cards could be ordered online.

All individuals who wanted to develop their skills to support their career could use an online training service. This gave access to training material on a range of subjects and information on where learning resources (e.g. videos and books) could be located. The system provided authorised users with access to a comprehensive range of management information. There was an online library where all the information about case studies, the company, competitors, clients, markets, policies, processes, products, reference material, signed contracts, specifications, standards, suppliers and technology, etc. was held. Individuals could also store documents within the library. Employment opportunities were placed online, as well as general information such as the telephone number for a taxi or that of the local pizza takeaway for anyone working late. As templates and forms were a part of everyday working life these were also made available on the system. This meant that a general manager who needed information on the most recent sales project, as well as its budget standing and information on the people involved (salary, grade, knowledge, skills, attributes), could request online to set up a particular template to accommodate the information needed and put it online so that it could be accessed at any time. The information would also change as the project progressed so the manager could also have ‘a real time’ view of the situation. So clients could benefit a personalised client web site was developed to ensure continuing good relationships with the customer. This facility provided a range of services that allowed clients to access real-time information about their projects.

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Nine key business applications were also provided for authorised users. These comprised: •

Purchase requisition

•

Expenses

•

Time management

•

Resource management

•

Capacity management

•

Client account management

•

Lead generation

•

Opportunity management

•

Campaign management.

Video conferencing was also used between the company’s international locations. One of the main benefits, apart from financial savings and face-toface benefits, (e.g. understanding the wider picture through facial expressions and hand gestures) was that misunderstanding which can result from variances of the information presented is avoided. For instance, some people omit to put versions numbers on the documents they send out. So three people could think they are looking at the same document but in fact they are looking at different versions. In video conferencing, a document can be sent online to all parties and this can be discussed during the video conference, knowing that it is the same document. Two key criteria described as essential in maximising the potential of the technology employed were that: •

The technology was made to serve the users rather than users serving the technology

•

It was humanised – the objective was to develop a ‘friendly’ system.

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Winchester City Council The authors would like to thank David Cowan, Chief Executive of Winchester City Council for this case study.

Background Winchester City Council, in the county of Hampshire, serves 110,000 people. The Council has 480 full and part-time staff and 55 elected Councillors. It provides a range of statutory and non-statutory services including environmental health, planning control, administration of Housing and Council Tax benefits and the running of museums, to mention a few.

Knowledge management When David Cowan was asked for his definition of knowledge management he said it wasn’t a simple question to answer: ‘As I see it, it’s a three-stage process. Firstly, knowledge management is about planning the information requirements of the organisation. The second stage is planning the information capture, storage and access systems. The third stage is providing access at the required level for everyone in the organisation – supported by training in how to use the systems.’ At Winchester City Council (WCC) knowledge management was seen as very important to the future success of the organisation and to the public sector generally. Two sets of drivers had been identified. One set of drivers related to the ‘citizen’ and customer involvement. An effective knowledge management system was seen as central both to facilitate this involvement and to develop it further. ‘Increasingly the community and people we serve want to know what is behind Council decisions. They want to know that their voices have been heard and their input taken into account. They want to see how they can influence decision making and they want to receive feedback. Effective knowledge management systems enable us to do this.’ The second set of drivers for knowledge management related to the increased expectations of people within the organisation to access wider information on Council strategy and the work of the different business areas. ‘Its no longer acceptable, or effective, to have people working in the old traditional watertight compartments. We have to recognise, and facilitate the flow of information within the organisation, the sharing of knowledge and experiences.’

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Responsibility for knowledge management is divided into two key components within WCC. The systems and technology side is handled by the IT department reporting through to the Chief Finance Officer. The communications and content side is the responsibility of a multi-disciplinary working group. The City Secretary and Solicitor chair this. David Cowan, as Chief Executive and his senior management team take a corporate overview. The IT function supports the Council’s Information and Communications Technology (ICT) strategy. The Communications Working Group takes responsibility for reviewing content and the standards of information and whether the Councils approach to communications meets the needs of the external and internal customer. The Council has both a written ICT strategy and a written communications strategy. The overall responsibility for ensuring that knowledge and skills are not lost in times of major change lies with the corporate management team and with the individual. It was also with the client who was responsible for their area of knowledge. This was the case because the build-up of knowledge systems was distributed, with specialists in some areas and with groups in certain other areas. So the responsibility lay with those responsible for the changed linkages and the changed situation of the functions that require that knowledge. Views on the knowledge economy were understandably orientated around the issue of ‘electronic-governance’ and electronic access to public services. The new ICT strategy had been developed with ‘e-government’ and community information systems in mind. The point was stressed that information and knowledge was not just required for the Council’s day-to-day business operations. As a public authority the Council had a role in helping the local community to make the most of the information available. The logistics of this meant developing access systems for the 110,000 people who lived in 250 square miles served by the Council.

Technology The Council have invested in new technology and are continuing to build on the investment. In the 1980’s they introduced their first office automation system, which covered core administrative and professional staff in each department. At that time, approximately 35% of staff were using it. The organisation produced a detailed cost plan linked to ‘manpower’ plans. They set, as a target, a five-year ‘payback period’ to cover the costs of the system with savings from its use. This was supported by detailed post implementation reviews at regular periods. The actual ‘payback’ was achieved within three years rather than five.

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During the 1980’s the Council also introduced document image processing in areas receiving high volumes of paper (such as the Housing Benefit area). This allowed the conversion of paper documents into electronic files for access and storage and is a system that has been continuously developed since onto a corporate basis. The approach of developing a technological solution in a specific area of demonstrable need, achieving the payback and expanding the application from a tried and tested base was typical of the Council’s approach. It combines the need to apply prudent financial management as a public body, whilst keeping at the forefront of relevant technological developments. Using this approach the Council had also managed to avoid any ‘white elephants’ or over ambitious schemes that failed to deliver. The Council has in operation, and is continuously developing, their intranet. This allows minutes of management meetings to be accessed by all staff as well as a weekly ‘chief executive’s briefing’ and a weekly update for elected councillors. David Cowan stressed the importance of publishing such information on the intranet: ‘All staff need to know what senior management is saying, proposing and doing.’ The network also provides staff with an electronic bulletin board and enables staff to make comments, share relevant information, start discussion groups and give feedback. Elected Councillors have the opportunity to be connected from home to the Council’s corporate IT systems and the intranet. At the present time not all the Councillors have taken up this option. Approximately forty of the fifty-five Councillors have direct dial-in access. System security is a high priority because of the nature of some of the information that the Council holds. One of the key issues addressed early on was the question of who needs access to what. Not every bit of knowledge within the organisation is available to everybody and needs to be known by everybody. For example, no member of staff who is not dealing with confidential benefit files or confidential personal files or financial files, would have access to this information. However, the core corporate knowledge of the organisation is available to all and they have developed the system so that all community agendas, reports and minutes are available on the intranet. Whilst the aim is to move towards a paperless community system and open up access to the wider public, difficulties were still felt to exist in achieving this because of the problems creating effective navigation and search facilities.

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Current major projects related to effective knowledge management include a new corporate database to provide a full analysis of reports, annual performance statistics and official circulars and statutory instruments, particularly in the area of town planning. This is linked with a major investment in a Geographical Information System (GIS) accessible for all relevant staff. This is particularly important in Local Government as many of the issues dealt with have a geographical reference.

People dimension The appraisal system at the council has been subject to regular reviews and updating, as needs change. It now includes a knowledge and skills audit of staff being appraised. Every single member of staff goes through an annual appraisal interview. As part of the discussion, the individual’s knowledge, skills and experience are discussed in relation to the current and future job requirements and personal development. Areas where updating may be required are identified as well as future training and development needs. This feeds through into training and development plans, which are produced at an individual, departmental and corporate level. The appraisal process is seen as one of the key ways of ensuring that knowledge and skills gaps are identified and addressed and that existing knowledge and skills do not become obsolete. There is a corporate competency framework in place against which staff are assessed and the underlying premise is that acceptable scores must be achieved in all areas. No low-level scores are acceptable. Succession planning within the organisation is on an informal, rather than formal basis. This is seen to reflect the relative size of the Council. The relative size also means that, in practice, most new recruits will be external appointments. The main aim is, for senior posts particularly, to have a credible internal candidate. This does not mean that the jobs go internally, but it was felt that if there was no credible internal candidate it reflected a failure to develop staff properly. Recruitment is always against a job and person specification that profiles the required knowledge, skills and experience required. The size of the organisation and the high level of specialist skills needed means that the Council also buys in expertise on a short-term and consultancy basis to meet knowledge gaps. They also use contracting-out arrangements. For example, the organisation was heavily dependent on IT but did not have the resources to retain in-house the full IT specialisation needed to provide cover for 365 days of the year. The skills and knowledge are bought-in, as they are needed, to supplement the in-house

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provision. They also buy in specialist knowledge in areas such as management consultancy to support the Best Value process in every major service area. Flexible working is the norm within the Council, both in terms of the requirements placed on staff and the corporate employment policies: ‘For years we have been putting a standard phrase on the job description covering ‘any other duties’. Nowadays we actually mean it. If you are customer focused and running a public service you have to be flexible. But the flexibility we expect from our staff is matched by the flexibility we show as an employer. That is all part of building trust and working together towards a common goal.’ Amongst the flexible employment policies adopted by the Council are: •

Home working – Staff at all levels can be considered for home working arrangements subject to operational requirements. Examples include legal staff that might work from home part of the week doing preparation work, researchers and staff that often work away from the main site. Working from home can be a full-time arrangement, but working from home part of the week has proved to be successful, for example, one of the Councils Chief Officers works from home one day a week, using the time to concentrate on reports and on research.

•

Job sharing – there are a number of cases of job-sharing where the arrangement has been introduced to fit the life-style requirements of particular members of staff.

•

Extended unpaid leave – provisions exist for this for staff that require an extended time-off but want the security of knowing they have a job to return to. This has often helped people deal with particularly difficult family circumstances.

•

Reduced/compressed hours – where practical this option has been used to help people deal with personal circumstances or personal lifestyle choices. An example, although exceptional, was one member of staff who wished to pursue an interest in sculpture. They needed one day a week to do this. The operational aspects were considered and it was agreed that they could compress their working week into four days enabling them to pursue their interest without a reduction in pay. From the Councils viewpoint, it meant retaining their specialist skills. Such arrangements do not have to be permanent. Particular arrangements may be put in place because of a family illness or because of temporary child care problems.

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There is a strong pragmatic element in the approach to people management, which recognises the need for the Council to be attractive to knowledge workers. As David Cowan pointed out: ‘We try to provide a flexible employment package. Being realistic we have to. Our main source of recruits is from a ‘travel to work’ area with the lowest unemployment in Europe. When recruiting public sector professionals we are also competing with 14 other local authorities within a half-hour travel distance of our offices. When recruiting professionals in areas such as IT we are competing with major private sector employers, many of whom will pay more.’ There was a strong sense of promoting the values of the organisation within the Council. This was seen as important to the staff and to the management approach. The idea of a ‘psychological’, as well as a legal, contract with individual employees was recognised as important. The Council was in the process of rewriting its staff handbook to place it on the intranet. This was seen as much more than a book of rules. It was seen as reflecting and embodying the psychological as well as legal contract and reflecting the values of the organisation. Key components of the relationship between employer and employees had been worked out over the last few years in consultation with staff focus groups. For example, the council’s health at work policy had been developed with staff focus groups and there is a corporate ‘health group’ involved in discussing with management how the Council can help promote a healthy workplace and healthy living for its staff. Similarly the new competency based annual appraisal system was developed using focus groups of staff to work with the in-house personnel specialists and external consultants. This involved staff looking at the various options available and feeding in their own views on what was an acceptable way to them to have their performance appraised: ‘We are trying to go beyond just trying to read and respond to the flow in the psychological contract between employers and employees. We are trying to articulate our own psychological contract by formally and informally involving all staff in jointly developing our whole range of human resources policies and practices.’ It was stressed that to be effective in a modern environment it was necessary to give people a wider dimension to their job and to provide them with accessible information systems that gave them the relevant information when they needed it. For this reason, knowledge management was high on the corporate agenda.

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Appendix 2 Summary checklist: Introduction to knowledge management 1.

Knowledge management is an evolving discipline. One area of continuing debate is whether knowledge is an object to be managed directly or a human process to be managed indirectly through people and systems.

2.

Knowledge is not the same as information.

3.

All organisations have unique knowledge resources – knowledge management seeks to gain maximum benefit from these resources.

4.

Knowledge management is a means to an end – achieving added value from the knowledge resources of an organisation – not an end in itself.

5.

Knowledge management links people, systems and information to produce added value.

6.

When getting involved in knowledge management, a useful first step is to develop an organisation specific understanding of the central concepts. This is part of developing a shared language and a shared understanding.

7.

Four key drivers for knowledge management are customer and citizen expectation, globalisation, new technology and competition.

8.

Knowledge management is relevant to both the business world and the world of Government services.

9.

According to the UK Government, to maintain a competitive edge in the knowledge economy organisations need to identify, capture and market the knowledge base that drives all products and services.

10. Knowledge management projects often involve knowledge audits, revising people management practices to foster innovation and creativity, investment in information and communications (ICT) technology and developing new ways of collaborative working.

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Appendix 3 Summary checklist: Knowledge management – the systems dimension 1.

At the heart of the systems dimension of knowledge management, is the shift from a technical focus to a people focus. That is, from what the technology can do, to what people can do with the information it makes accessible.

2.

Key drivers for the investment in technology are to give people access to information they need when they need it and to provide them with the applications to use that information and to share it.

3.

Newer technologies are flexible, non-linear and designed to reflect and support the innovative and creative capacity of individuals.

4.

The development and the popularity of Web based technology has enabled organisations to create a platform for interactive working and a ‘knowledge repository’ accessible from anywhere in the world at a relatively low cost.

5.

The perceived benefit, by employees, of using an intranet will be a large determinant of its success.

6.

The main limitation to the information to be placed on intranets is the resource needed to maintain it and keep it up-to-date.

7.

The information contained in e-mails is a considerable knowledge asset that needs to be managed.

8.

An organisation that has never generated innovation and creativity within its staff is unlikely to do so simply because of the introduction of the technology.

9.

To deal with the volumes of information it is necessary to develop effective search and navigation tools for accessing information, knowledge filtering processes and a user friendly interface between individuals and knowledge sources.

10. The storing and indexing of knowledge needs to be a dynamic process in order to allow for updating, modifications and amendments to the contents of the ‘knowledge repository’.

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Appendix 4 Summary checklist: Knowledge management – the people dimension 1.

Knowledge management is a multi-disciplinary area requiring the collaboration of personnel, IT and information specialists.

2.

A key role for personnel specialists is to help bridge the gap between what people know – the information and expertise they have available to them – and what they do.

3.

Knowledge management will be more effective if the pay and reward system recognises people for sharing their knowledge, for acquiring new knowledge and for sharing information.

4.

When recruitment, retention and succession planning are viewed from a knowledge management perspective, the approach becomes less about ‘filling jobs’ and more about filling knowledge gaps – either current or anticipated.

5.

The retention of knowledge involves taking into account the higher expectations and higher perceptions of self and economic worth of knowledge workers.

6.

Succession planning in the context of knowledge management has to include planning for the retirement of people and systems.

7.

The importance of knowledge for competitive advantage and service excellence is increasing the ‘power’ of knowledge workers, giving them a greater voice in how they are managed. This is impacting on the role of managers as well as corporate employment polices leading to more consensual models of managing.

8.

Training and development activities in a knowledge environment need to focus on equipping managers to foster innovation and creativity, enabling staff to manage their own learning and development, training in the skills of using information effectively and training in the techniques for generating new ideas and new ways of doing things.

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4 S U M M A RY C H E C K L I S T: K N O W L E D G E M A N A G E M E N T – T H E P E O P L E D I M E N S I O N

9.

The creation of ‘virtual teams’, using the Internet, enables organisations to bring a diverse ranges of skills and abilities to bear on issues and projects. Virtual teams can include employees, associates, suppliers and customers.

10. In managing teams of knowledge workers, individuals need to be allowed to apply their own expertise and knowledge with minimum interference and maximum autonomy.

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Appendix 5 Summary checklist: Knowledge management – the organisational dimension 1.

It is the ‘cultural environment’ that will determine whether the investment in technology and information will be matched by an equal investment from individual knowledge workers in using it to greatest effect.

2.

For effective knowledge management the organisational culture needs to support integrated and collaborative working, pooling knowledge and information within the organisation.

3.

For information to flow freely through an organisation and for knowledge to be shared, the structure of the organisation needs to be flexible, less hierarchical, less formal and less controlling.

4.

Flatter structures do not necessarily mean less well resourced structures, cutting out the resources can lead to ‘information overload’. ‘Burnt out’ staff are not creative or innovative.

5.

The willingness of individuals to share information and knowledge will be inhibited in a culture that is excessively competitive or where internal relationships are highly ‘political’.

6.

Whilst a common starting point for knowledge management is a knowledge audit, a better starting point is likely to be an analysis of the current culture.

7.

The development of information and communications technology can remove some of the reasons for organisations to exist in their current forms with their current support infrastructures – such as the need for a geographic base and the need to directly employ people to be able to co-ordinate and manage their activities.

8.

Structures of organisations are changing to accommodate virtual teams and flexible working practices, as well as the increase in the number of ‘employees’ seen as periphery workers.

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5 SUMMARY CHECKLIST: KNOWLEDGE MANAGEMENT – THE ORGANISATIONAL DIMENSION

9.

Many ‘old’ businesses are successfully adapting to the opportunities presented by the Internet, utilising it as part of a continuing process of improving the use of information, reducing production costs and streamlining the supply chain.

10. A knowledge audit answers the question ‘what does the organisation know?’, ‘what could it know?’ and ‘what should it know?’. The ultimate aim is to leverage maximum added value from the knowledge resources.

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Appendix 6 References

Chapter 1 1.

C. Harman and S. Brelade ‘Knowledge Management and the role of HR’ Financial Times, Prentice Hall, 2000 ISBN: 0 273 64456 4

2.

DTI White Paper ‘Our Competitive Future: Building the Knowledge Driven Economy’, Stationery Office 1998

Chapter 2 1.

Paul Strassman ‘The Squandered Computer’ 1997 Information Economics Press, ISBN: 0-9620413-1-9

2.

UK Online Annual Report, November 2002

3.

Spiro, R.J., Coulson, R.L., Feltovich, P.J., & Anderson, D, ‘Cognitive flexibility theory: Advanced knowledge acquisition in ill-structured domains’, in V. Patel (ed.), Proceedings of the 10th Annual Conference of the Cognitive Science Society. Hillsdale, NJ: Erlbaum (1988)

4.

Spek, R, van der & Spijkervet, A.L. ‘Kennismanagement’ (1995)

5.

Article in the magazine ‘Director’, July 1999

Chapter 3 1.

Advisory, Conciliation and Arbitration Service publication ‘Introduction to Payment Systems’

2.

Salancik, G. & Pfeffer, J. ‘Who gets power?’, 1977, Organisational Dynamics, Winter pp3-21

3.

North, V. & Buzan,T, ‘Get Ahead’, 1994 Bournemouth: Buzan Centre Books

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6 REFERENCES

Chapter 4 1.

Brian Arthur ‘Increasing Returns and Path Dependence in the Economy’ 1994, University of Michigan Press

2.

‘Modernising Government’ March 1999 published by The Stationery Office

3.

Margaret Ryan ‘Human resource management and the politics of knowledge: linking the essential knowledge base of the organisation to strategic decision making’, MCB University Press 1995 ISSN: 0143-7739

4.

DTI White Paper ‘Our competitive Future: Building the Knowledge Driven Economy’, Stationery Office, 1998

5.

‘E-commerce: the truth behind the Web’, Vladimir López-Bassols and Graham Vickery, OECD Directorate for Science, Technology and Industry, OECD Bulletin, January 2001

Chapter 5 1.

Dr Ross Todd, Head of Information Studies, University of Technology, Sydney

2.

Office of the e-envoy: www.e-envoy.gov.uk

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Appendix 7 Further reading

Chapter 1: Introduction to knowledge management DTI White Paper (1998) ‘Our Competitive Future: Building the Knowledge Driven Economy’ Ballinger,Gene KM – ‘Energising Perspectives’ (See web site address www.outsight.com) Ryle, Gilbert (1976) ‘The Concept of Mind’, Penguin (ISBN: 0140550291) Locke, John (1979) ‘An Essay Concerning Human Understanding’, Oxford University Press (ISBN: 0 19 824595 5) Hume, David (1980) ‘A Treatise of Human Nature’, Oxford University Press (ISBN: 019 824588 2) Hamel, Gary (Winter, 1998) ‘Opinion, Strategy, Innovation and a Quest for Value’, Sloane Management Review, Vol.39, No 2, Pages 7-14 Dauphinais, William & Price, Colin, (1998) ‘Straight from the CEO’, Nicholas Brealey Publishing Limited (ISBN: 1857881958) Harman, Chris, Brelade, Sue (2000) ‘Knowledge Management and the Role of HR’ Financial Times, Prentice Hall (ISBN: 0 273 64456 4)

Chapter 2: Knowledge management – the systems dimension Davenport T and Prusack, L (1997) ‘Working Knowledge – How organisations manage what they know’ Harvard Business School, Boston MA (ISBN: 0875846556) Strassman, Paul (1997) ‘The Squandered Computer’, Economic Press (ISBN: 0-9620413-1-9)

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Chapter 3: Knowledge management – the people dimension Bridges, William, (1995) ‘Jobshift – How to prosper in a workplace without jobs’, Allen & Unwin (Australia) Nicholas Brealey Publishing Limited (UK) (ISBN: 1857880617) Brelade, Sue, Harman, Chris, Miller, Tony (1999) ‘Practical Training Strategies for the Future’, Financial Times Management (ISBN: 0273633953) Allinson, C. W and Hayes, J (1996) ‘The Cognitive Styles Index: A Measure of Intuition – Analysis for organisational Research’, Journal of Management Studies, Oxford, Vol 33: No 1, pages 119-35 Storey, John (ed) (1993) ‘New perspectives on Human Resource Management’, Routledge (ISBN: 0415010411) Hunter J.E and R. ‘Validity and Utility of Alternate Predictions of Job Performance’ Psychological Bulletin vol. 96 pp 72-88. 1984 – study on validity coefficients for different selection methods Tyson, Shaun (ed) (1995) ‘Strategic Prospects for HRM’ Institute of Personnel and Development, London (ISBN: 0 85292 578 6) Harvey-Jones, John (1989) ‘Making It Happen – Reflections on Leadership’, Fontana (ISBN: 0 00 637409 3) Sadler, Philip (1993) ‘Managing Talent’, The Economist Books Ltd (ISBN: 0 7126 9857 4) Apter, Michael (1998) ‘Motivation, Emotion & Personality’, Routledge Edenborough, Robert (1994) ‘Using Psychometrics: A Practical Guide to Testing and Assessment’ Kogan Page ( ISBN: 0749413026) Katzenbach, Jon (1998) ‘Teams at the Top’, Harvard Business School Press, ISBN: 0 87584 789 7 Goleman, Daniel (1998) ‘Working with Emotional Intelligence’, Bantam IPD National Conference 28-30 October 1998 Seminar on ‘Competing in the Third Wave – using Knowledge well’ Speaker Professor Tony Hope INSEAD

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Chapter 4: Knowledge management – the organisational dimension Brian Arthur ‘Increasing Returns and Path Dependence in the Economy’ University of Michigan Press 1994 Faure, M & Faure L, (1996) ‘The Success Culture’, FT Pitmans Publishing (ISBN 0 273 621998) Harrison, Roger (1987) ‘Organisational Culture and Quality of Service’, London, Association for Management Education and Development (ISBN: 1870469003) Gates, Bill (1996) ‘The Road Ahead’, Penguin, (ISBN: 0 14 024351 8) De Geus, Arie (Winter 1998) ‘A Recipe for success in the New Economy’, Washington Quarterly Lewis, Jane (May 1999) ‘Power of the People, Innovation Special, HR’s Challenge’, Personnel Today Magazine, pages 34,35,37 King, N and Anderson, N (1995) ‘Innovation and Change in Organisations’, Routledge (ISBN: 0 415 08467 9) Drucker, Peter (1994) ‘Innovation and Entrepreneurship’ Butterworth Heinemann (ISBN: 0750619082) Jaques, Elliot and Clements, Stephen (1991) ‘Executive Leadership A Practical Guide to Managing Complexity’, Basil Blackwell (ISBN: 1 55786 257 5) Handy, Charles (1985) ‘Understanding Organisations’, Harmondsworth, Pelican Books (ISBN: 0140091106) Spencer, J & Pruss A, (1992) ‘Managing your Team’, Piatkus Ltd (ISBN: 0 7499 1295 2) Tyson, Shaun (ed) (1995) ‘Strategic Prospects for HRM’, Institute of Personnel and Development, London Chapter 2 ‘Changing Work Roles’ Alistair Mant (ISBN: 0 85292 578 6) Drucker, Peter (1992) ‘Managing for the Future’, Butterworth Heinemann Wilson Graham (1993) ‘Making Change Happen’, Financial Times, Pitman Publishing (ISBN: 0273602594) De Geus, Arie,(1997) ‘The Living Company’, Harvard Business School Press Drucker, Peter (1994) ‘Innovation and Entrepreneurship’ Butterworth Heinemann (ISBN: 0 7506 1908 2)

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Useful web sites www.kmresource.com The Knowledge Management Resource Centre is provided by IKM Corp., located in Atlanta, Georgia USA. The site provides useful reviews and links to a number of knowledge management (KM) resources worldwide. It also provides a listing of KM publications (books and journals). It is professionally presented and easy to navigate.

www.kmnews.com Knowledge Management News™ is a site maintained by Brad Hoyt (Hoyt Consulting). It is designed for practitioners and provides a free monthly eZine (electronic magazine) and articles focused on knowledge management, creativity and innovation.

www.brint.com Run by @Brint.com™ this site is a leading ‘portal’ for information, current practice and research on new economy issues covering e-business, information, technology, and knowledge management. The site is comprehensive and accessible with numerous articles, links and discussion groups and an e-mail newsletter.

www.outsights.com This site is run by a non-profit alliance of leading technology companies. The aim of the alliance is to work together to solve industry-wide challenges. Links to papers, books and articles are provided. The site has a strong focus on using knowledge to improve customer support.

www.kmtool.net Edited by Jennie Starr, this site provides useful links and search facilities. The site is designed to promote sharing and collaboration among individuals working in the knowledge management industry (worldwide) and to act as a resource for planning knowledge management projects.

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www.e-envoy.gov.uk This is the official site of the ‘Office of the e-Envoy’. It provides comprehensive information on Government e-strategy initiatives, discussion forums and details on support to business and communities. It also provides useful links and statistical data on the e-economy in the UK.

http://bprc.warwick.ac.uk The Business Processes Resource Centre at Warwick University is funded by the Economic and Social Research Council. This is an academic site with information and articles on leading edge research in knowledge management.

www.melcrum.com Publishers of the ‘Knowledge Management Review’. The Melcrum website also provides useful articles to download, as well as links and answers to frequently asked questions about knowledge management.

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Other specially commissioned reports BUSINESS AND COMMERCIAL LAW

The commercial exploitation of intellectual property rights by licensing

The Competition Act 1998: practical advice and guidance

CHARLES DESFORGES

SUSAN SINGLETON

£125.00

£149.00

1 85418 285 4 • 2001

1 85418 205 6 • 2001

Expert advice and techniques for the identification and successful exploitation of key opportunities.

Failure to operate within UK and EU competition rules can lead to heavy fines of up to 10 per cent of a business’s total UK turnover.

This report will show you: •

how to identify and secure profitable opportunities

•

strategies and techniques for negotiating the best agreement

•

the techniques of successfully managing a license operation.

Insights into successfully managing the in-house legal function BARRY O’MEARA

£65.00

1 85418 174 2 • 2000

Damages and other remedies for breach of commercial contracts ROBERT RIBEIRO

£125.00

Negotiating the fault line between private practice and in-house employment can be tricky, as the scope for conflicts of interest is greatly increased. Insights into successfully managing the In-house legal function discusses and suggests ways of dealing with these and other issues.

1 85418 226 X • 2002 This valuable new report sets out a systematic approach for assessing the remedies available for various types of breach of contract, what the remedies mean in terms of compensation and how the compensation is calculated.

Commercial contracts – drafting techniques and precedents ROBERT RIBEIRO

£125.00

1 85418 210 2 • 2002 The Report will: •

Improve your commercial awareness and planning skills

For full details of any title, and to view sample extracts please visit: www.thorogood.ws You can place an order in four ways:

•

Enhance your legal foresight and vision

1 Email: [email protected]

•

Help you appreciate the relevance of rules and guidelines set out by the courts

2 Telephone: +44 (0)20 7749 4748

Ensure you achieve your or your client’s commercial objectives

4 Post: Thorogood, 10-12 Rivington Street, London EC2A 3DU, UK

•

t +44 (0)20 7749 4748

e [email protected]

3 Fax: +44 (0)20 7729 6110

w w w w. t h o r o g o o d . w s

The legal protection of databases SIMON CHALTON

Email – legal issues £145.00

SUSAN SINGLETON

£95.00

1 85418 245 5 • 2001

1 85418 215 3 • 2001

Inventions can be patented, knowledge can be protected, but what of information itself?

What are the chances of either you or your employees breaking the law?

This valuable report examines the current EU [and so EEA] law on the legal protection of databases, including the sui generis right established when the European Union adopted its Directive 96/9/EC in 1996.

The report explains clearly:

Litigation costs MICHAEL BACON

•

How to establish a sensible policy and whether or not you are entitled to insist on it as binding

•

The degree to which you may lawfully monitor your employees’ e-mail and Internet use

•

The implications of the Regulation of Investigatory Powers Act 2000 and the Electronic Communications Act 2000

•

How the Data Protection Act 1998 affects the degree to which you can monitor your staff

•

What you need to watch for in the Human Rights Act 1998

•

TUC guidelines

•

Example of an e-mail and Internet policy document.

£95.00

1 85418 241 2 • 2001 The rules and regulations are complex – but can be turned to advantage. The astute practitioner will understand the importance and relevance of costs to the litigation process and will wish to learn how to turn the large number of rules to maximum advantage.

International commercial agreements REBECCA ATTREE

£175

1 85418 286 2 • 2002 A major new report on recent changes to the law and their commercial implications and possibilities. The report explains the principles and techniques of successful international negotiation and provides a valuable insight into the commercial points to be considered as a result of the laws relating to: pre-contract, private international law, resolving disputes (including alternative methods, such as mediation), competition law, drafting common clauses and contracting electronically. It also examines in more detail certain specific international commercial agreements, namely agency and distribution and licensing. For full details of any title, and to view sample extracts please visit: www.thorogood.ws You can place an order in four ways: 1 Email: [email protected] 2 Telephone: +44 (0)20 7749 4748 3 Fax: +44 (0)20 7729 6110 4 Post: Thorogood, 10-12 Rivington Street, London EC2A 3DU, UK

S e e f u l l d e t a i l s o f a l l T h o r o g o o d t i t l e s o n w w w. t h o r o g o o d . w s

HR AND EMPLOYMENT LAW

Employee sickness and fitness for work – successfully dealing with the legal system GILLIAN HOWARD

£95.00

1 85418 281 1 • 2002 Many executives see Employment Law as an obstacle course or, even worse, an opponent – but it can contribute positively to keeping employees fit and productive. This specially commissioned report will show you how to get the best out of your employees, from recruitment to retirement, while protecting yourself and your firm to the full.

How to turn your HR strategy into reality TONY GRUNDY

£129.00

1 85418 183 1 • 1999 A practical guide to developing and implementing an effective HR strategy.

Internal communications JAMES FARRANT

£125

1 85418 149 1 • July 2003 How to improve your organisation’s internal communications – and performance as a result.

Data protection law for employers SUSAN SINGLETON

£125

There is growing evidence that the organisations that ‘get it right’ reap dividends in corporate energy and enhanced performance.

1 85418 283 8 • May 2003 The new four-part Code of Practice under the Data Protection Act 1998 on employment and data protection makes places a further burden of responsibility on employers and their advisers. The Data protection Act also applies to manual data, not just computer data, and a new tough enforcement policy was announced in October 2002.

MARK THOMAS

£69.00

1 85418 270 6 • 2001 Practical advice on how to attract and keep the best.

Successfully defending employment tribunal cases

1 85418 008 8 • 1997

This report will help you to understand the key practical and legal issues, achieve consensus and involvement at all levels, understand and implement TUPE regulations and identify the documentation that needs to be drafted or reviewed.

New ways of working STEPHEN JUPP

DENNIS HUNT

£95.00

Why do so many mergers and acquisitions end in tears and reduced shareholder value?

Successful graduate recruitment JEAN BRADING

Mergers and acquisitions – confronting the organisation and people issues

£99.00

£95 1 85418 169 6 • 2000

1 85418 267 6 • 2003 Fully up to date with all the Employment Act 2002 changes. 165,000 claims were made last year and the numbers are rising. What will you do when one comes your way?

t +44 (0)20 7749 4748

e [email protected]

New ways of working examines the nature of the work done in an organisation and seeks to optimise the working practices and the whole context in which the work takes place.

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Knowledge management SUE BRELADE, CHRISTOPHER HARMAN

changes to internal disciplinary and grievance procedures

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significant changes to unfair dismissal legislation

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new rights for those employed on fixed-term contracts

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the introduction of new rights for learning representatives from an employer’s trade union

£95.00

1 85418 230 7 • 2001 Managing knowledge in companies is nothing new. However, the development of a separate discipline called ‘knowledge management’ is new – the introduction of recognised techniques and approaches for effectively managing the knowledge resources of an organisation. This report will provide you with these techniques.

Reviewing and changing contracts of employment ANNELISE PHILLIPS, TOM PLAYER and PAULA ROME

This specially commissioned new report examines each of the key developments where the Act changes existing provisions or introduces new rights. Each chapter deals with a discreet area.

Email – legal issues £125

SUSAN SINGLETON

£95.00

1 85418 215 3 • 2001

1 85418 296 X • 2003 The Employment Act 2002 has raised the stakes. Imperfect understanding of the law and poor drafting will now be very costly.

360,000 email messages are sent in the UK every second (The Guardian). What are the chances of either you or your employees breaking the law? The report explains clearly:

This new report will: •

Ensure that you have a total grip on what should be in a contract and what should not

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Explain step by step how to achieve changes in the contract of employment without causing problems

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Enable you to protect clients’ sensitive business information

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Enhance your understanding of potential conflict areas and your ability to manage disputes effectively.

Applying the Employment Act 2002 – crucial developments for employers and employees AUDREY WILLIAMS

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How to establish a sensible policy and whether or not you are entitled to insist on it as binding

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The degree to which you may lawfully monitor your employees’ e-mail and Internet use

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The implications of the Regulation of Investigatory Powers Act 2000 and the Electronic Communications Act 2000

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How the Data Protection Act 1998 affects the degree to which you can monitor your staff

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What you need to watch for in the Human Rights Act 1998

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TUC guidelines

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Example of an e-mail and Internet policy document.

£125

1 85418 253 6 • May 2003 The Act represents a major shift in the commercial environment, with far-reaching changes for employers and employees. The majority of the new rights under the family friendly section take effect from April 2003 with most of the other provisions later in the year. The consequences of getting it wrong, for both employer and employee, will be considerable – financial and otherwise. The Act affects nearly every aspect of the work place, including: •

flexible working

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family rights (adoption, paternity and improved maternity leave)

For full details of any title, and to view sample extracts please visit: www.thorogood.ws You can place an order in four ways: 1 Email: [email protected] 2 Telephone: +44 (0)20 7749 4748 3 Fax: +44 (0)20 7729 6110 4 Post: Thorogood, 10-12 Rivington Street, London EC2A 3DU, UK

S e e f u l l d e t a i l s o f a l l T h o r o g o o d t i t l e s o n w w w. t h o r o g o o d . w s

SALES, MARKETING AND PR

Implementing an integrated marketing communications strategy

Tendering and negotiating for MoD contracts

NORMAN HART

TIM BOYCE

£99.00

£125.00

1 85418 120 3 • 1999

1 85418 276 5 • 2002

Just what is meant by marketing communications, or ‘marcom’? How does it fit in with other corporate functions, and in particular how does it relate to business and marketing objectives?

This specially commissioned report aims to draw out the main principles, processes and procedures involved in tendering and negotiating MoD contracts.

Defending your reputation Strategic customer planning ALAN MELKMAN AND PROFESSOR KEN SIMMONDS

SIMON TAYLOR £95.00

1 85418 255 2 • 2001 This is very much a ‘how to’ Report. After reading those parts that are relevant to your business, you will be able to compile a plan that will work within your particular organisation for you, a powerful customer plan that you can implement immediately. Charts, checklists and diagrams throughout.

1 85418 251 • 2001 ‘Buildings can be rebuilt, IT systems replaced. People can be recruited, but a reputation lost can never be regained…’ ‘The media will publish a story – you may as well ensure it is your story’ Simon Taylor ‘News is whatever someone, somewhere, does not want published’ William Randoplh Hearst When a major crisis does suddenly break, how ready will you be to defend your reputation?

Selling skills for professionals KIM TASSO

£65.00

1 85418 179 3 • 2000 Many professionals still feel awkward about really selling their professional services. They are not usually trained in selling. This is a much-needed report which addresses the unique concerns of professionals who wish to sell their services successfully and to feel comfortable doing so. ‘Comprehensive, well written and very readable… this is a super book, go and buy it as it is well worth the money’ Professional Marketing International

Insights into understanding the financial media – an insider’s view SIMON SCOTT

This practical briefing will help you understand the way the financial print and broadcast media works in the UK.

European lobbying guide £129.00

1 85418 144 0 • 2000

Corporate community investment £75.00

Understand how the EU works and how to get your message across effectively to the right people.

1 85418 192 0 • 1999 Supporting good causes is big business – and good business. Corporate community investment (CCI) is the general term for companies’ support of good causes, and is a very fast growing area of PR and marketing.

t +44 (0)20 7749 4748

£99.00

1 85418 083 5 • 1998

BRYAN CASSIDY

CHRIS GENASI

£95.00

e [email protected]

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Lobbying and the media: working with politicians and journalists

Managing corporate reputation – the new currency

MICHAEL BURRELL

SUSAN CROFT and JOHN DALTON

£95.00

1 85418 240 4 • 2001

1 85418 272 2 • June 2003

Lobbying is an art form rather than a science, so there is inevitably an element of judgement in what line to take. This expert report explains the knowledge and techniques required.

ENRON, WORLDCOM… who next?

Strategic planning in public relations KIERAN KNIGHTS

£69.00

At a time when trust in corporations has plumbed new depths, knowing how to manage corporate reputation professionally and effectively has never been more crucial.

Surviving a corporate crisis – 100 things you need to know

1 85418 225 0 • 2001

PAUL BATCHELOR

Tips and techniques to aid you in a new approach to campaign planning.

1 85418 208 0 • April 2003

Strategic planning is a fresh approach to PR. An approach that is fact-based and scientific, clearly presenting the arguments for a campaign proposal backed with evidence.

£125

£125

Seven out of ten organisations that experience a corporate crisis go out of business within 18 months. This very timely report not only covers remedial action after the event but offers expert advice on preparing every department and every key player of the organisation so that, should a crisis occur, damage of every kind is limited as far as possible.

FINANCE

Tax aspects of buying and selling companies MARTYN INGLES

Practical techniques for effective project investment appraisal £99.00

RALPH TIFFIN

£99.00

1 85418 189 0 • 2001

1 85418 099 1 • 1999

This report takes you through the buying and selling process from the tax angle. It uses straightforward case studies to highlight the issues and more important strategies that are likely to have a significant impact on the taxation position.

How to ensure you have a reliable system in place. Spending money on projects automatically necessitates an effective appraisal system – a way of deciding whether the correct decisions on investment have been made.

Tax planning opportunities for family businesses in the new regime CHRISTOPHER JONES

£49.00

1 85418 154 8 • 2000 Following recent legislative and case law changes, the whole area of tax planning for family businesses requires very careful and thorough attention in order to avoid the many pitfalls.

S e e f u l l d e t a i l s o f a l l T h o r o g o o d t i t l e s o n w w w. t h o r o g o o d . w s

MANAGEMENT AND PERSONAL DEVELOPMENT

Strategy implementation through project management TONY GRUNDY

£95.00

1 85418 250 1 • 2001 The gap Far too few managers know how to apply project management techniques to their strategic planning. The result is often strategy that is poorly thought out and executed. The answer Strategic project management is a new and powerful process designed to manage complex projects by combining traditional business analysis with project management techniques.

For full details of any title, and to view sample extracts please visit: www.thorogood.ws You can place an order in four ways: 1 Email: [email protected] 2 Telephone: +44 (0)20 7749 4748 3 Fax: +44 (0)20 7729 6110 4 Post: Thorogood, 10-12 Rivington Street, London EC2A 3DU, UK

t +44 (0)20 7749 4748

e [email protected]

w w w w. t h o r o g o o d . w s